I will continue to post information relevant to this agreement as it affects many folks who have invested in Panama and those that may consider to do so in the future.
This article from La Prensa brings to light Panamanian officials statements that "there will be no automatic exchange of information, calls or fishing expeditions, and information exchanged will be treated as confidential and not disclosed to other countries." And from the banking association we get "However, ABP said that the agreement can be beneficial, "provided that" the disclosure is made in an objective manner as to affect only the accounts of customers who are under investigation in the U.S. for tax evasion or tax fraud."
I received a note from President Martinelli this morning stating the same thing, however I see nothing in the 12 articles that would require the U.S. to have an individual under criminal investigation for tax evasion. In article 5 section 5 it states " All requests for information made by one party must be made with the highest degree of specificity possible. In all cases, such requests must specify in writing the following:
(A) the identity of the taxpayer whose taxes or criminal liability which is under investigation;
In article 4 under definitions it states "(B) "criminal tax matters" means tax matters involving intentional conduct which is liable to prosecution under the criminal laws of the Requesting Party;"
This is an important distinction because these are the only references to any investigation and it states "criminal liability" and the IRS would not necessarily need to have a criminal case open on an individual to believe he has a criminal liability. From the viewpoint of the IRS we are all guilty until proven innocent.
I interpret this to allow the IRS to open an investigation without filing any criminal action against the individaul in a court of law. Where from their statements I believe the Panamanian authorities interpret this as a criminal investigation which would involve a court. If this is the case then it does allow for a fishing expedition. I have lived in Panama long enough to know that there is ALLWAYS some confusion regarding interpretations and this is much too important to allow for confusion.
I hope to be able to get answers directly from the MICI on this when the signers return from Washington.
Machine translated from La Prensa:
Edith Castillo Duarte
Rafael Berrocal
[email protected]
The Panamanian government believes that the signing of tax information agreement will bring significant economic benefits to the country.
This would be vital in the Panama route has taken out of the gray list of the Organization for Economic Cooperation and Development (OECD) and could encourage ratification of the Trade Promotion Authority (TPA) was signed with the U.S. in 2007 whereas Washington has said it expects fiscal reforms in the Panamanian regime before the trade agreement is in effect.
The Minister of Economy and Finance, Alberto Vallarino, who attended yesterday's ceremonial act, he reiterated that the agreement of tax information privacy of individuals continue to be protected and secured against undue intrusion.
He said there will be no automatic exchange of information, calls or fishing expeditions, and information exchanged will be treated as confidential and not disclosed to other countries.
The Banking Association of Panama (ABP) endorsed the agreement with the United States in order to exit the list of tax havens, while lawyers launched heavy criticism.
For PBL, the signing of the agreement with the United States gives Panama a cooperating country image in the international community, something positive for foreign investment, which could allow the output of the gray list of tax haven.
"The Panamanian Banking Center has been harmed by being in these OECD greylisting, as has been the reason for the withdrawal of some banks in our country and has prevented some companies from those countries deemed to Panama for investment and business" , said the guild bank.
However, ABP said that the agreement can be beneficial, "provided that" the disclosure is made in an objective manner as to affect only the accounts of customers who are under investigation in the U.S. for tax evasion or tax fraud.
The ABP also recommended the Government to ensure that mechanisms for the exchange of information will guarantee to the Panamanian banking center customers full transparency, and verify that there are equal at all points of the agreement, "as it would be beneficial that we force them to comply with an agreement that is not feasible for both parties. "
Vallarino, along with Vice President and Foreign Minister, Juan Carlos Varela, and Deputy Minister of Economy, Frank De Lima, responded yesterday to questions that "unfairly" you make this agreement.
The lawyers do not like to admit, Vallarino said that with respect to bearer shares was adopted more flexible for them. Not being eliminated, he said, but is being asked to identify their owners.
The lawyer Eduardo Morgan maintains its position that the agreement itself could affect the country. "The perception that Panama gave the United States would lead to many foreign depositors pull their money from the banking center of Panama, especially the Latin countries like Venezuela, Colombia and Argentina," said Morgan.
He said such a situation would lead to Panama's economy foundered.
Meanwhile, the Bar Association sent a letter to Economy Minister Alberto Vallarino, which highlights some points that says concern. "We are concerned in the same way that Panama agree to provide factual information that may be criminal in the United States but who are not in Panama, specifically in the area of tax issues," says the letter signed by union president Ruben Elias Rodríguez.
"We believe this agreement, the importance of the national economy, but also for the dignity and respect they deserve as free, independent and sovereign country, should be widely discussed in all forums to debate issues that are important for our present and our future ", claimed the National Bar Association.
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