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Difference Between Directors and Shareholders in a Panama Company

To establish a company in Panama, it is important to know the main differences between the parts that form it, and its key functions within them. Many clients have confusion between the two figures. By understanding the position and roles, of each of them, the client can make a better decision on regard to the way the company will be structured:

• Companies in Panama must be formed by a minimum of three (3) directors who maybe three (3) individuals of any nationality as long as they are of legal age. On the other hand, the shareholders have no minimum number required; a single natural or legal person also of any nationality can form the board of shareholders. 

• The directors are not considered the owners of the company,  but those who administer it. The directors are not entitled to vote in the decisions of the shareholders meeting unless the articles of incorporation established otherwise. O the other hand, the shareholders are considered the owners of the company; having a common stock shall give the entitlement to make decisions within the shareholders' meeting.

• The names and addresses of the directors are published in the articles of incorporation, which is the public document by which the company is established and registered. Contrary, the identities of the shareholders are 100% private because the shares certificates are not registered in any document or public institution.

• If the client wishes to preserve the confidentiality or simply do not have three people of trust or to fill the positions of directors, it has the choice of appointing a nominee director (members of Delvalle & Delvalle), however the client, or the natural or juridical person designee by him/her, must always be appointed as a shareholder to have real control of the entity.

• The nominee directors never act as signatories on bank accounts, the shareholder must always be the signatory.

Note: For the opening of bank accounts, if the client appoints its own directors, these directors must travel to Panama along with the shareholders- signatories of the account, regardless of whether they are signatories or not. Also, they must provide all documents required by the Bank.

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Although there are many differences between shareholders and directors, there are certain similarities; For example, directors and shareholders can be of any nationality, they do not require Panamanian citizenship or be physically in Panama to maintain their positions.

shareholders vs directors bank account panama


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