There are several important benefits that come with registering a vessel in Panama, which is why the country has become the top choice for shipping companies and private boat owners.
In fact, there are more than 8,000 maritime vessels that have registered in Panama, which means there are more ships flying the Panama flag than any other. This works out to more than 82 million tons of boat registered here, which is about 22% of the total tonnage in the world.
So, an important question is: what types of vessels can be registered in Panama?
Before we dive into that, though, let’s set the stage with a related question:
Why Register Any Vessel in Panama?
One of the most unique features of Panama’s vessel and ship laws is its open registry. This means that anyone from anywhere in the world can register their vessel here.
All vessels and ships have to be registered somewhere (for the purposes of taxes and operating procedures), but, sometimes, the laws and restrictions in one’s home country may be a little too strict. It’s not uncommon for owners to look for a more optimal location for registration.
Of course, there’s more to it than just the open registry. After all, just because it’s open doesn’t mean there’s no oversight. There are still governmental inspections and other legal matters that will come up on a regular basis. Still, there are a number of other benefits, including:
- No restrictions on nationality for ship owners
- In compliance with international maritime safety agreements
- No requisite on minimum tonnage (more on this in a moment)
- Effective security and privacy around the registration
- Income derived by vessels doing international trade is not taxed by Panama
- Dual registration is possible
So, now that we know why, let’s talk about what types of vessels can be registered in Panama.
The simple answer is: almost any vessel.
This is due to one of the features mentioned above:
No Minimum Tonnage
Panama does not have any minimum tonnage requirements for ships to get registered in the country. This means that small boats and yachts can register in the country and fly the Panamanian flag just as readily as a huge commercial tanker.
However, any vessel – no matter the size – that is over 20 years old will have to be inspected by an official Panama inspector before it can be registered.
Let’s take a look at some of the other special types of vessels that may have slightly different rules and benefits.
Yachts, sailing vessels, and catamarans can all be registered in Panama, and it is a very popular choice for boat owners because the process is simpler and less expensive than most other countries.
In fact, pleasure vessels only have to pay an initial fee of $1,500 USD to register. It gets even more affordable if the vessel is owned by a Panamanian citizen, corporation, or private interest foundation. In these cases, the fee is only $1,000 USD.
The owner of the vessel can acquire a provisional registration first if they need a little extra time to get all the necessary documentation in order for a permanent registration.
If you register an entire fleet in Panama, you can receive a discount on your registration.
- Fleets with 5 to 15 vessels = 20% discount
- Fleets with 16 to 50 vessels = 35% discount
- Fleets with 51+ vessels = 60% discount
Ships Under Construction
A ship does not even have to be fully completed before starting the registration process. If a vessel is still under construction, it can apply for a Panama Provisional Registration.
Panama allows dual registration, which means that a ship can be registered here as well as in another country.
There are, naturally, a few rules around this process, but Panama is generally always open to it.
That does not, however, mean that the other country will be. The vessel’s home country must also allow dual registry in order to proceed.
Use an Attorney to Register Your Vessel Correctly
Just because Panama has an open registry and a comparatively simple and affordable registration process, an attorney who understands the maritime laws in Panama can be a huge help.
At Mata & Pitti, Attorneys at Law, our experienced lawyers can help you:
- Set up ship mortgages by ensuring that all the necessary information is correct and available.
- Deal with the maritime court and make sure you have someone on your side who understands the system.
- Comply with all the international environmental and safety regulations.
- Complete the registration process and avoid many of the issues that could potentially get in your way.
So, to answer the original question, you can register pleasure vessels, tankers, cargo ships, an almost any other kind of ship in Panama and take advantage of several unique benefits.
However, it is still important to have someone on your side to help with your ship registration.
Contact us today if you have any questions about the process or want to get started as soon as possible.