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FAQs on Panama Papers

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1. What are the 'Panama Papers'?
The 'Panama Papers' are a set of confidential documents
leaked from one of the biggest law firms of Panama 'Mossack Fonseca'. The Panama Papers provide
information about thousands of offshore entities, identities
of their shareholders and directors. It listed various world
leaders, public officials, billionaires, celebrities, sports
stars and politicians.
2. How much data has been leaked and by whom?
a) The leaked data consists of 11.5 Million Documents in
around 2,600 GB taken from the Mossack Fonseca's
internal database by one of its employees.
b) These documents were obtained by Sueddeutsche
Zeitung, a daily newspaper headquartered in Munich,
Germany. Sueddeutsche shared the Panama Papers with
the Washington-based International Consortium of
Investigative Journalists (ICIJ) and other news outlets,
including the BBC, the Guardian and the Indian Express.
c) Sueddeutsche mentioned that an employee at the law

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3. What does the Panama Papers reveal?
a) The Panama Papers contain information on 2.15 lakhs offshore entities connected to people from more
than 200 countries.
b) The leaked data covers nearly 40 years period from 1977 through the end of 2015.
c) It reveals the database of individuals who have set-up offshore entities through the Panama law firm.
d) These individuals are either holding direct ownership or indirect ownership (beneficial ownership) in
the offshore entities.
e) Some of the Indians have also floated offshore entities at a time when foreign exchanges laws of India
did not allow them to do so.
4. What is the authenticity of documents leaked?
Ramon Fonseca, one of the co-founder of the Mossack Fonseca, confirmed the authenticity of the papers
being used in articles published by more than 100 news organizations around the world. He told to one of
the Panama's news channel that the documents are real and were obtained illegally through a hacking
method.
5. Who is 'Mossack Fonseca' and what is its role in this entire controversy?
a) Mossack Fonseca & Co. is a law firm and corporate service provider based in Panama with more than
40 offices worldwide.

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b) It specializes
in commercial
law, trust services, investor advisory and international structures.

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d) This law firm is one of the seven firms that collectively represent more than half of the companies
incorporated in Panama.
e) It also provides assistance in transferring funds, buying property, setting-up trusts or signing
agreements with entities.
f) Mossack Fonseca plays a crucial role in incorporating entities in tax havens. It had incorporated
14,658 active companies in Panama till August, 2013 out of which 4,646 companies were incorporated
without providing any information about their shareholders.
6. How entities incorporated in Panama provide secrecy about the beneficial owners?
a) Panama offers the most favorable and most flexible company incorporation laws available in the
world. Private Interest Foundations are also available, and are one of the most widely used estate
planning structures in the world today.
b) Panama is the registered domicile for over 400,000 corporations & foundations, making it one of
the most popular jurisdictions in the world to incorporate.
c) Panama does not impose any reporting requirements for non-resident Panamanian corporations.
d) Panama does not allow "piercing the corporate veil".
e) Panamanian corporations share certificates can be issued in Nominative or Bearer form
(anonymous form of ownership), with or without par value.
f) Panamanian Companies can have directors, officers and shareholders of any nationality and

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g) The offshore entity in Panama need not appoint natural persons as directors or have individuals as
shareholders.
h) Neither the directors nor the officers of Panamanian corporations need to be shareholders. Meetings of
directors, officers, and shareholders may be held in any country and accounting books may be kept in any
country.
i) It is not necessary for the interested parties to be present in Panama for the purpose of establishing a
corporation. Corporations conducting business outside of Panama do not require a commercial license for
offshore business activities.
j) Registered Panamanian Agents offers its own executives to serve as shareholders or directors.
Sometimes an intermediary law firm or a bank acts as a director or a nominee shareholder. So the real
beneficiary remains hidden.
k) The registered agent provides an official overseas address, a mail box, etc., none of which traces back
the entity to the beneficial owner.
7. What are the key advantages of incorporating a Panamanian Company?
a) The incorporation process is fast and can be achieved in 3 days.
b) The identity of the shareholders is not publicly available.
c) Nominee and bearer shares are allowed.
d) There are no currency restrictions although the US dollar is regularly used.

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g) Meetings can be held in Panama or in any jurisdiction, subject to tax advice.
h) Accountsdo not need to be held in Panama.
8. What are Panama foreign exchange rules?
a) Panama's circulating currency is the US Dollar, and Panama has no currency exchange controls or currency
restrictions, so funds can flow in and out of the country freely.
b) Panama uses the U.S. dollar as its legal currency, instilling tremendous fiscal and monetary discipline while
keeping inflation very low - under 2 percent for the last 40 years.
c) Panama has no restrictions on monetary remittances abroad, including dividends, interests, branch profits
and royalties. No restrictions on funds flowing in or out of the country.
d) A dollar economy insulates Panama from global economic shocks. During the Asian monetary crisis of 1998,
Panama became one of the healthiest economies in Latin America.
9. How secure is banking infrastructure of Panama?
a) Panama is one of the most secure offshore financial center - where privacy and confidentiality is vigorously
protected by constitutional law.
b) Panama offers the best bank secrecy and corporate book secrecy laws in the world.
c) Panama has no provision for "piercing the corporate veil".

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d) Revealing banking information to third parties is a crime, punishable by prison.
e) Panama has no mutual legal assistance treaties (MLAT's) for sharing of banking information with any
other nation and does not recognize court rulings from other countries.
f) Panama City is home to the second largest international banking center in the world next to
Switzerland. Panama has the most modern and successful international banking center in Latin America,
with more than 150 banks from 35 different countries.
g) Approximately 150 international banks are located in Panama. Total assets in Panamanian banks are
over US$150 billion.
h) Some of the banks present in Panama's banking center are: Citibank, HSBC, Dresdner Bank, Bank of
Tokyo, Bank of Boston, Banco Nacional de Paris, International Commercial Bank of China, Societe
Generale, Banque Sudameris, BBVA, Banco Uno, Banco General, PriBanco, Banco del Istmo, Global Bank,
MultiCredit Bank, PanaBank, ABN Amro, Banco Aliado, Banco Continental, BancoLat, BIPAN, Lloyds TLB
Bank, Bank of Nova Scotia BIPAN, Bank of Nova Scotia, and much more.

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