Sweeping immigration, labor law changes take effect
11 Jun 19
IMPACT – HIGH
What is the change? Panama has overhauled its immigration and labor laws.
What does the change mean? The changes include creation of a new temporary visa for U.S. nationals, extension of work permit validity in some categories while restricting it in others, and eased procedures for professional work permit applications.
- Implementation time frame: Immediate and ongoing.
- Visas/permits affected: Temporary stay visas for U.S. nationals, work permits for permanent residents, work permits under the 10% or 15% quota, visas for spouses of Panamanian nationals, short-term work permits, visas for aviation personnel, work permits for refugees, work permits under the Marrakesh Agreement, professional work permits.
- Who is affected: Employers and foreign nationals applying for any of the visas or permits listed above.
Additional information: The reforms were announced in late May and took immediate effect. Among key changes, officials have:
- Created a new temporary stay visa for U.S. nationals. The visas are available to U.S. nationals for the purposes of studying, investing or conducting temporary work or technical transference in Panama. The visas are valid for one year and renewable up to a total of five years. While the regulations do not specifically require a separate work permit, U.S. nationals using a temporary stay visa are encouraged to obtain a temporary work permit as well.
- Created a new three-year work permit for foreign nationals with permanent residence. Anyone holding permanent residence will be able to obtain a renewable work permit valid for three years at a time. Applicants in this category will not need to obtain company sponsorship or a quota allocation. Previously, some categories of permanent residents were not eligible for work authorization.
- Extended the validity of work permits under the 10% or 15% quota. Work permits under the 10% or 15% quota will now be valid for two years, renewable in two-year periods. After 10 years, work permit holders in these categories may apply for an indefinite work permit.
- Extended the validity of visas for spouses of Panamanian nationals to two years. Work permits for spouses of Panamanian citizens will now be initially valid for two years, renewable in three-year periods. After 10 years, visa holders in this category may apply for an indefinite work permit.
- Restricted the validity of visas for aviation personnel. Permits in this category will be limited to a two-year validity period, renewable twice for a total of six years.
- Restricted the validity of work permits for refugees. Work permits in this category will be issued with a one-year validity period, renewable once for an additional year.
- Imposed a new rule on companies using the Marrakesh Agreement. Only companies with at least three Panamanian employees will be able to apply for work permits under the agreement, which allows companies with fewer than 10 employees to sponsor one foreign worker.
- Changed requirements for professional work permit applicants. Applicants may now submit applications while their professional visa applications are pending by providing a temporary immigration ID card, a copy of a final immigration ID card or a copy of a permanent residence card issued by the Civil Registry. First-time applicants will be required to provide an apostilled copy of their university degree.
Analysis & Comments: On the whole, the changes will help companies recruit and retain foreign nationals in Panama. In some cases, however, work permits will be restricted or subject to additional application requirements. Employers are encouraged to review the new rules and amend immigration and recruitment plans as needed.
Source: Deloitte LLP. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London EC4A 3HQ, United Kingdom.