General Information about vessel registration under the Panamanian Flag
Any foreign or Panamanian national may register a vessel in the Panamanian Merchant Marine. International service vessels are exempt from Panama income tax. Shipowners take advantage of the flexibility of Panamanian offshore corporations by having such entity appear as owner of the vessel. Any ship may be registered provided it complies with the minimum seaworthiness, safety and environmental conditions required by international conventions.
The Registration consists in two steps: provisional and permanent. The Director of The Economic and Commercial Office of Panama in Hong Kong will handle the initial paperwork and is authorized to issue temporary documentation including a provisional Certificate of Registration (normally known as “Patente”), valid for 6 months and a provisional Radio License, valid for 6 months. The procedure is straightforward and is usually completed within the same day, as soon as registration fees and first year's annual charges are paid in the office.
The shipowner must appoint a Panamanian law firm to act as its representative in Panama. That firm will file the title of ownership with the Public Registry Office, in Panama, and submit an application for permanent registration to the Shipping Department within the validity period of the temporary certificates.