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Latin America Investment News on Viva Tropical

Panama Holding Out on FATCA Agreement

Article Summary:

Panama’s banks are up in arms that the nation’s Minister of Economy and Finance has not signed its FATCA agreement with the U.S. Bankers say this puts them in a dangerous spot, but the Minister refuses to budge. Why?

Photo Credit: Prensa Panama

Original Article Text From Prensa:

Pending the Minister

Panama’s financial sector is waiting for the signing of an agreement between the Ministry of Economy and Finance (MEF) and the Internal Revenue Service (IRS equivalent to the Department of Revenue) in the United States for recognition of financial institutions as complying Panamanian Law Enforcement Fiscal Accounts Abroad (FATCA, for its acronym in English).

Under this policy, the Government of the United States (U.S.) requires financial institutions around the world to share information on U.S. citizens. If a bank does not meet this requirement, its operations in the United States (directly or through correspondents) would be limited and charged with a traffic jam. Therefore, all Panamanian center banks are making efforts to meet the demands of the law.

The July 15 opens the deadline for companies to begin the certification process individually, but Panamanian bankers have expressed their intention that FATCA system entry is made jointly by prior agreement to 15 July between governments. However, the lack of clarity from the MEF and the fact that is not yet officially announced the signing of an agreement, are raising doubts in the sector.

“They’re not giving the seriousness it deserves such a complex issue,” said an industry source. “Something as delicate due solved long ago. It’s almost irresponsible not to have completed these negotiations, “said another source, who asked not to be named.

Asked about last Wednesday at a press conference, the head of the MEF, Frank De Lima, said that the situation would be resolved before July 15.

This journal MEF repeatedly consulted during the week through emails to expand the details on the status of talks with the U.S. authorities, but there was no response.

“I hope they insured by the Minister is achieved,” said another banker, who recalled that “only the MEF is responsible for the issue.”

For the banking sector is important to the joint entrance to the platform through a FATCA agreement that standardizes the process intergubermanental.

Since its approval in the U.S. in 2010, the implementation of the law has raised questions and doubts in the financial system outside the U.S..

After several delays, finally the first of January next will begin to realize the information exchange entities compliant with U.S. authorities, a move with which the world’s most powerful country seeks to combat tax evasion by its citizens at the expense of the efforts of financial institutions around the world.

For banks, it’s like when you go to a party and reluctantly ends up paying the bill.

Link to Original Article:

From Prensa

  • charlie

    dont sign it, that puts Panama in subjection to the idiots in the USA (too big to fail myth) bankers. it will help USA and HURT Panama. No more cow-towing to the USA socialists

  • nomadcapitalist

    One word: good. Does anyone else ever think about how US government bureaucrats react to their reading of tales about various foreign bankers scurrying, like rats on a ship, to comply with their latest draconian overreach? How many share my view that these statist bureaucrats get a psychosexual rush from seeing the rest of the world running to bend to their will?

Latin America Investment News on Viva Tropical