Panama International Business Company

Companies in Panama and Stock Capital

Panama International Business Company

In a company, the stock capital is the monetary amount, or the value of goods that shareholders bring to the company, whether through shares certificates or participation fees depending on the type of company that is being incorporated.

It’s the capital that appears in the article of incorporation of the company. Law in Panama requires such capital to be a minimum of US $ 10,000.00. This capital should not be fully paid or released.

In some cases, the stock capital may also represent a portion of capital that a company will receive in the future for existing shares for cash. The stock capital is divided into equal shares with values that can then be distributed among shareholders, who can be owners of the company (if common shares) or simply investors of it (if preferred shares).
The shares do not have a minimum set value. A company in Panama may, therefore, set the price of shares at any monetary value. The shares, however, have a fixed nominal value, depending on the type of share that’s issued.

When you establish a company in Panama, you can decide how many shares will be issued from stock capital. Just make sure that the value of each of them sums up the total of the shares included in the total stock capital.

Share Capital of Companies in Panama

Companies in Panama establish their stock capital in the article of incorporation, which is registered in the Panamanian Public Registry. The authorized stockholders’ equity is simply the maximum amount of the stock capital that the company may issue.

The company establishes its authorized stockholders’ equity, indicating the number of shares in the article of incorporation. However, corporations in Panama can change their authorized stockholders’ equity at any time either by increasing the stock capital or by issuing more shares than the ones that are already established. This provides entities with the flexibility of changing parameters based on the changing needs and realities of their business.

Issue and allocation of shares of a Panama Company

Two types of shares may be issued in Panama: registered and bearer shares. Both can be issued as common shares or as preferred shares as well.

An example has been provided below of how stock capital and shares are registered in the Article of incorporation of a company in Panama:

The authorized stockholders’ equity shall be the sum of TEN THOUSAND DOLLARS (US $ 10,000.00), the legal currency of the United States of America, divided into ONE HUNDRED (100) REGISTERED shares with a nominal value of ONE HUNDRED DOLLARS (US $ 100.00) each, which may be common or preferred. b) The right to vote shall exclusively belong to holders of common shares of the company at the rate of one vote per share c) Notwithstanding what’s determined about by the Board of Directors, the share certificates shall be signed by the President accompanied by the Secretary or the Treasurer of the corporation. The stock capital may be increased one or more times for which new shares may be created and issued, representing contributions in cash, in-kind or nature, by the application of available funds coming from special reserves, or any other lawful means, provided this is approved by the General Meeting of Shareholders or the Management Board.

The type of shares that your corporation will use will depend on the distribution of such shares among the shareholders. Common shares are entitled to vote while preferred shares are only entitled to receive dividends.

No-par value shares

Companies in Panama have the right to issue no-par value shares, which means that shares will not have a specific value.


The authorized stockholders’ equity consists of FIVE HUNDRED (500) no-par value common shares. The stock capital will be at least equal to the total amount represented by the shares with par value (if any), plus the value that the company may receive from the issuance of no-par value shares and the amounts that from time to time may be added to the stock capital in accordance with the Board of Directors resolutions.

The shares will be sold for the price that from time to time the Board of Directors determines. The shares may be issued either in bearer or registered form and will be exchangeable for one or another according to its owner’s will. It is up to the Board of Directors to open and close the subscription of shares whenever it deems convenient.

Changing the Stock Capital of a Company in Panama

There are several ways of changing the stock capital of a Company in Panama.

It can be mentioned:

  1. Increase the stock capital of the company, so that it has the right to issue more shares.
  2. Increase the stock capital of the company, without increasing the number of existing shares, but increasing the value of each share already issued.