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Trade Regulations and Standards in Panama

May 2013

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Sections

Import Tariffs Return to top

When Panama joined the WTO in 1997, the government lowered tariffs to a maximum of 15%, except for a few agricultural products, and to an overall average of 12%, the lowest in the region. The revised import duty structure was significantly lower than the one negotiated for WTO accession and represented a substantial commitment to trade liberalization. In October 2012, the Trade Promotion Agreement (TPA) between the United States and Panama came into effect and reduced import duties to zero for 87% of the products in the tariff schedule, with the exception of some food and agricultural products, on which duties will reduce gradually over the course of the next ten years.

Trade Barriers Return to top

As part of the negotiations for the TPA, the previous administration approved a Phytosanitary Agreement that eliminated sources of discretion and abuse in the import approval process, thus lifting any existing phytosanitary barriers. Panama has no other trade barriers.

Import Requirements and Documentation Return to top

Import Licenses

No import licenses are required in Panama. Any company holding a commercial license can freely import goods into Panama. A commercial or industrial license is required by individuals or companies wishing to engage in commercial or industrial activities. Phytosanitary permits are required to import non-food agricultural products only. Special import permits are required for all types of firearms, ammunition, fertilizers, and certain foods. Import permits can be obtained from the Ministry of Security.

Export Controls

The Fiscal Code regulates all matters concerning the country's exports. The Code establishes that all national products may be exported, except:

  • Drugs, with the exception of those having pharmaceutical or scientific purposes.
  • Staple products determined by the government to be temporarily scarce in the country.
  • Those products the Panamanian government decides not to export for reasons of international agreements or for the economic interest of the country.

Law 61 of 2002 abolished the requirement for some exports (primarily metals and natural resources) to pay taxes.

Import Documentation Return to top

Processing of customs documents in Panama for imports is fast, efficient and reliable. Merchandise imported into Panama must be cleared through customs by a customs broker licensed by the government of Panama. The following goods are imported under duty free status: those that are consigned to national or municipal governments, imported by foreign diplomats, consigned to the Panama Canal, sold to vessels transiting the Canal, or intended for re-export.

Basic import documentation required by the Panamanian Customs office includes:

  • Import Declaration (prepared and signed by a customs broker).
  • Commercial Invoice (original plus four copies to be presented in English or Spanish).
  • Airway Bill.
  • Bill of Lading (to be presented in triplicate).
  • Commercial license number.
  • Phytosanitary Certificate (In case of animal and plant products, to be obtained from the U.S. Department of Agriculture), and previous authorization from the Panamanian Food Safety Authority (AUPSA).
  • Certificate of Free Sale (if required).
  • Certificate of Origin (in the case of application for duty free treatment).

While no official form is required to document content of origin under the U.S.-Panama TPA, we have published a sample form that includes instructions in English and Spanish. U.S. exporters and Panamanian importers are free to use this format which is available by clicking here.

Any food product or other item used for human consumption (including for use on human skin or clothes) may be subject to the Certificate of Free Sale (CFS) documentation requirement. The main purpose of the CFS is to verify that a product is sold freely and used widely in the U.S. Potential exporters of items subject to the CFS documentation requirement may wish to contact the Food and Drug Administration, Division of Programs and Enforcement Policy, 200 C Street, SW, Washington, DC 20204. As of the date of this publication, the relevant FDA guidance can be found here: http://www.fda.gov/RegulatoryInformation/Guidances/ucm125789.htm.

The bill of lading must be presented for the clearance of goods without exception. If for any reason any other required document cannot be presented within 24 hours after the shipment has arrived, clearance of the goods will be permitted by posting a bond equal to the amount of import duties. The bond is cancelled if the prescribed documents are presented in due form within a period of 90 days. The bond may be extended in justified cases, an additional 90 days.

Export Documentation Return to top

The Vice Ministry of Foreign Trade (VICOMEX) was created in 1998 to promote exports and investment. It facilitates the processing of export documentation through a "One Stop" (Ventanilla Unica) office that can reduce the export process to a few hours.

Export documentation required by Panamanian customs authorities includes:

  • Commercial invoice.
  • Export declaration (usually prepared and signed by a customs broker).
  • Certificate of Origin (issued by the Chamber of Commerce, Industry and Agriculture of Panama, VICOMEX, or SIP/Sindicato de Industriales de Panama and approved by VICOMEX).
  • Bill of Lading.
  • Airway Bill.
  • Veterinary, Sanitary or Phytosanitary Certificate (when applicable).

There is no requirement to use export brokers for export documentation.

U.S. Export Controls Return to top

There are no specific U.S. export controls regarding Panama, with the exception of fire arms, ammunition and certain high tech goods that require U.S. export licenses.

Temporary Entry Return to top

The Panamanian Fiscal Code establishes a temporary entry regime of 90 days for all types of merchandise. This temporary entry may be extended for up to one year. There are two options for temporary entry. First, the goods can enter the country if the importer makes a deposit equivalent to the import duty. This payment will be reimbursed at the time the goods leave the country. Second, an insurance company can issue a bond for the importer covering the import duty value, payable if the goods fail to exit the country as scheduled.

Special temporary provisions apply in the case of trade shows and exhibitions taking place at Panama's exhibition and convention center, Atlapa. Goods can enter the Atlapa Convention Center with no warranty payment or bond required.

Samples with commercial value are subject to temporary entry requirements. Samples with no commercial value are admitted duty free. If samples arrive in large containers, they will be dutiable even though they may be marked as free samples.

If the goods are eligible for duty free treatment under the TPA between the United States and Panama, the above procedure does not apply.

Labeling and Marking Requirements Return to top

Local regulations require labels to be in the Spanish language. However, this regulation is not enforced at present, except for medicines, agricultural chemicals, toxic products, and food products that require specific instructions or warnings due to human health risks. Labels are required to have basic information regarding the name and address of manufacturer, expiration date, list of ingredients, lot number, and the product form, e.g. powder, liquid, etc.

In general, products which comply with U.S. labeling and marking requirements are accepted for sale in Panama. Food products labeling and marking must comply with CODEX Alimentarius guidelines.

All goods arriving in Panama intended for re-exportation immediately must be marked "PANAMA IN TRANSIT" on each box or outside container.

Prohibited and Restricted Imports Return to top

The following products cannot be imported into Panama:

  • Counterfeit coins or printed material that imitates currencies.
  • Equipment or instruments for manufacturing coins.
  • Liquors, wines, beers or medicines with labels that falsely describe contents, or of any kind of harmful preparation.
  • Certain firearms or war materials.
  • Foreign lottery or raffle tickets.
  • Opium in the form of gum or for smoking.
  • Obscene brochures, books, newspapers, magazines, or postcards containing negative portrayals of the country's culture, civilization or dignity.
  • Plants, seeds, or animals when determined by the Ministry of Agriculture.

Customs Regulations and Contact Information Return to top

Customs Regulations

Panama assesses import duties on an ad valorem basis. The ad valorem system uses the declared CIF value as the basis for import duty calculations and in some cases utilizes historical price information as a reference.

In addition to the duty, all imports into Panama are subject to a 7 percent transfer or value added tax (ITBM) levied on the CIF value, plus import duty and other handling charges. Pharmaceuticals, foods and school supplies are exempt from the ITBM tax.

Due to the TPA between the U.S. and Panama, some 87% of U.S. products enter Panama duty free. For other products, duties may be phased out over time. Since there are a number of exceptions it is convenient to check what products are under duty free regime. We suggest that U.S. exporters go through the following process to determine duties today and in the future:

1. Customs Info Database - shows you tariffs/duties that Panama is currently assessing. You can access this database by simply signing up with your email address. Note: Panama already allows duty-free imports for certain projects, e.g. Canal expansion or Metro construction. Please contact us for more information on these exceptions.

2. Tariff Tool for Free Trade Agreements – shows you how tariffs will be phased out for any particular good in any country that has a Free Trade Agreement (current or pending) with the U.S. Cautionary note: this tool does not show agricultural products. In addition, it is not completely accurate for current tariff rates; instead, it shows what Panama is allowed to charge, which may be higher.

If you are selling a product with U.S. content, even if it is being sold through the Colon Free Zone to other countries in Latin America, it is worth documenting the content of origin. Doing so makes your products more profitable if sold not only in Panama but through the Colon Free Zone to other countries in Latin America with which the U.S. has a Free Trade Agreement, e.g. Chile, Peru, Colombia, or Dominican Republic. Documenting content of origin is not difficult – a sample Content of Origin document is available for your use here.

Beginning in 1995, Panama adopted the Harmonized System (HS) or Tariff Nomenclature as its customs classification system.

In general, the Panamanian customs system does not represent a significant obstacle for U.S. exporters.

Contact information for the Panamanian customs’ office is:

Direccion General de Aduanas
P.O. Box 0819-07729
Panama, Panama
Phone: 507-506-6407
Fax: 507-506-6240
Contact: Virna Luque, Director
E-Mail: evelyn.ballesteros@ana.gob.pa
www.ana.gob.pa

Standards Return to top

Overview
Standards Organizations

Conformity Assessment

Notify U.S. Service

Product Certification

Accreditation

Publication of Technical Regulations

Contacts

Standards Overview Return to top

As a WTO member, Panama implemented the WTO's Agreement on Technical Barriers to Trade (TBT) that includes the Code of Good Practice for the Preparation, Adoption and Application of Standards. The government of Panama (GOP) passed Law 23 of July 15, 1997, which established new dispositions on product standards, labeling and certification policy, and redefined the functions of the Directorate General of Standards and Industrial Technology (DGNTI) and the Panamanian Commission for Industrial and Technical Standards (COPANIT). Basically, DGNTI was given the main role in establishing standards and technical regulations, while COPANIT was given an advisory role to DGNTI. The National Council for Accreditation (CNA) was charged with all national accreditations.

Panama has an open economy and there are no significant market access problems related to standards and technical regulations. Certain market access problems have occurred in the past with several agricultural products, but they have been mostly related to phytosanitary issues.

According to WTO guidelines, Panama informs WTO of any standards or technical regulations activities. U.S. companies can participate in the standards development process by contacting DGNTI and submitting specific requests or suggestions. There are no limitations to participation by foreign countries.

Products for which Panama has not set standards/regulations can enter the Panamanian market provided that they comply with standards and technical regulations from the U.S., Europe or any other industrialized country.

Standards Organizations Return to top

The Directorate General of Standards and Industrial Technology (DGNTI) establishes technical regulations and standards in Panama. Because of budget and other limitations, this organization has been mostly dedicated to establishing standards for food products upon specific requests by industrial organizations and according to WTO guidelines. DGNTI establishes a semiannual working plan showing all activities it will undertake for the following six months. DGNTI performs its functions through its three departments: Standards, Certifications and the Information Center.

U.S. Government’s “Notify U.S.” Service Return to top

Member countries of the World Trade Organization (WTO) are required under the Agreement on Technical Barriers to Trade (TBT Agreement) to report to the WTO all proposed technical regulations that could affect trade with other Member countries. Notify U.S. is a free, web-based e-mail subscription service that offers an opportunity to review and comment on proposed foreign technical regulations that can affect your access to international markets. Register online at http://www.nist.gov/notifyus/.

Conformity Assessment Return to top

While DGNTI leads in conducting conformity assessments, it is joined by a number of other public and private organizations. These organizations include the Central Laboratory of Health from the Ministry of Health (MINSA), the University of Panama, the Technological University of Panama, the National Secretariat of Science and Technology (SENACYT), the Ministry of Agricultural Development (MIDA), the Consumer Protection Authority and Defense of Competition, and the Agricultural Marketing Institute (IMA). Panama does not have any Mutual Recognition Agreement (MRA) with U.S. organizations.

Product Certification Return to top

Once the conformity assessments have been conducted, the DGNTI will issue a conformity assessment certificate. DGNTI is the only organization authorized to issue conformity assessments related to products. Other private organizations such as SGS and Bureau Veritas deal with conformity assessments on system or procedures and can issue certificates, but only related to systems.

Accreditation Return to top

The National Council for Accreditation (CNA) created by Law 23, July 15, 1997, is the government authority in charge of all national accreditations. This Council is formed by a number of government organizations including the Ministries of Commerce, Health and Agricultural Development, and the National Secretariat of Science and Technology (SENACYT). The CNA works through a technical secretariat, which is the technical body of the Council. Accreditation is largely voluntary.

The technical secretariat appoints accreditation committees, which are groups formed by specialists from the public and private sectors. These committees provide basic input for CNA decisions. Accreditation is obligatory for organizations that deal with fuel laboratories and environmental testing laboratories. All other accreditations are voluntary. Accreditation can be granted in three categories: Laboratories (calibration and testing), inspection organizations, and certifying organizations. As of December 2010 there were fifteen organizations that had been accredited by CNA, but there were several accreditation applications under review.

Publication of Technical Regulations Return to top

All final technical norms and regulations are published by the Ministry of Commerce and Industry in the Official Gazette or “Gaceta Oficial.”

Law 23 requires that the Panamanian Commission for Industrial and Technical Standards (COPANIT) and the General Directorate of Standards and Industrial Technology (DGNTI) publish all agreements, technical regulations, norms and procedures.

Official Gazette or Gaceta Oficial: http://www.gacetaoficial.gob.pa/
Panama, Rep. of Panama
Tel. (507) 527-9393
Fax. (507) 527-9391

The WTO TBT Inquiry Point and National Information Center is:

Comision Panameña de Normas Industriales y Tecnicas (COPANIT)
P.O. Box 0815-01119
Panama, Rep. Of Panama
Tel. (507) 560-0716
Fax. (507) 560-0721
E-mail: dgnti@mici.gob.pa
http://www.mici.gob.pa

Trade Agreements Return to top

Panama has full FTAs in force with the following countries or economies: (with date of entry into force): El Salvador (2003), Taiwan (2004), Singapore (2006), Chile (2008), Costa Rica (2009), Honduras (2009), Guatemala (2009), Nicaragua (2010),Peru (2012), U.S. (2012), and Canada (2013). Panama has partial trade agreements with Mexico (1985), Dominican Republic (1987), and Cuba (2009). It is engaged in active negotiations with Colombia and the EFTA countries and has completed negotiations on agreements with the European Union (signed in 2010 but not yet in force).

The U.S. – Panama TPA’s primary benefit for U.S. companies is to lower tariffs on most goods. However, the TPA also includes provisions relating to customs administration and trade facilitation, technical barriers to trade, government procurement, investment, telecommunications, electronic commerce, intellectual property rights, and labor and environmental protection. Under the TPA, U.S. firms will have better access to Panama’s services sector than Panama provides to other WTO Members under the General Agreement on Trade in Services. All services sectors are covered under the TPA except where Panama has made specific exceptions. Moreover, Panama agreed to become a full participant in the WTO Information Technology Agreement. Panama has also entered into a bilateral agreement with the United States that resolved a number of regulatory barriers to trade in agricultural goods ranging from meat and poultry to processed products, including dairy and rice.

Panama has bilateral investment agreements with the United States, the United Kingdom, France, Switzerland, Germany, Taiwan, Canada, Argentina, Spain, Chile, Uruguay, the Czech Republic, Netherlands, Cuba, Mexico, Dominican Republic, Korea Ukraine, Sweden, Qatar, Finland, and Italy. The U.S.-Panama Bilateral Investment Treaty (BIT) entered into force in 1991 (with additional amendments in 2001 to reflect Panama's joining the International Center for the Settlement of Investment Disputes (ICSID). The investor protection provisions in the TPA have supplanted those in the BIT. Nevertheless, the TPA preserves for ten years the option for investors to invoke dispute settlement under the BIT with respect to investments covered by the Treaty as of the date of entry into force of the TPA, in the case of disputes that arose prior to the date of entry into force of the TPA, and for disputes arising on or after the date of entry into force of the TPA out of an investment agreement that was in effect before the date of entry into force of the TPA.

Contacts Return to top

Ministerio de Comercio e Industrias (Ministry of Commerce and Industry)
Ricardo Quijano, Minister
P.O. Box 0815-01119
Panama, Republic of Panama
Tel: (507) 560-0661
Fax: (507) 560-0663
www.mici.gob.pa

Direccion General de Normas y Tecnologia Industrial (DGNTI)
Contact: Vacant, Director General
P.O. Box 0815-01119
Panama, Rep. of Panama
Tel. (507) 560-0716
Fax. (507) 560-0721
E-mail: dgnti@mici.gob.pa

Comision Panameña de Normas Industriales y Tecnicas (COPANIT)
Contact: Ahmed Moron, Acting Director
P.O. Box 0815-01119
Panama, Rep. of Panama
Tel. (507) 560-0716
Fax. (507) 560-0721
E-mail: dgnti@mici.gob.pa

Consejo Nacional de Acreditacion (CNA)
Contact: Ahmed Moron, Section Chief
P.O. Box 0815-01119
Panama, Republic of Panama
Phone: (507) 560-0715
Fax: (507) 560-0715
E-mail: aemoron@mici.gob.pa
http://www.cna.gob.pa

Ministerio de Desarrollo Agropecuario (Ministry of Agricultural Development)
Oscar A. Osorio, Minister
P.O. Box 0816-01611
Panama, Republic of Panama
Tel: (507) 507-0601
Fax: (507) 232-9045
www.mida.gob.pa

Ministerio de Salud, (Ministry of Health)
Dr. Javier Diaz, Minister
P.O. Box 0816-01611
Panama, Republic of Panama
Tel: (507) 512-9100
Fax: (507) 512-9240
www.minsa.gob.pa

For More Information

The U.S. Commercial Service in Panama can be contacted via e-mail at: enrique.tellez@trade.gov;

Phone: 011-507-317-5000; or visit our website: http://www.export.gov/panama.