The Republic of Panama has established itself as a business hub in Latin America, supported by its stable economy, strategic geographic location, and immigration policies favorable to foreign investment. Within this migratory framework, Multinational Companies duly licensed as Multinational Headquarters (SEM), pursuant to authorization granted by the Ministry of Commerce and Industries, play a pivotal role by attracting global talent through competitive employment opportunities and relocation benefits, in addition to the tax incentives granted under this special economic regime.
Nevertheless, an important question arises: what benefits are available to the families of executives hired under the SEM regime?
In practice, the recruitment of highly qualified professionals by SEM entities is frequently subject to the benefits that may be extended to their dependents. Under Panamanian law, SEM executives may include, within their provisional residence permit, those individuals legally recognized as dependents, namely: children up to twenty-five (25) years of age who are enrolled in full-time studies, parents, and spouses.
A recurring inquiry concerns spouses: Is my husband/wife authorized to work in Panama? In the past, the answer was an unequivocal “no.” However, subsequent amendments to immigration and labor legislation expanded the scope of benefits afforded to executives and their dependents, including the possibility for spouses to obtain a Work Permit. Initially, there was uncertainty as to whether such authorization was indeed permitted, whether compliance was required with the statutory percentages balancing national and foreign labor, and whether such permits would be limited by position or salary thresholds.
As a matter of law, in order to apply for the Work Permit for Dependents of SEM Executives (Type 4D: Migrant Worker under Special Economic and Investment Policy Categories), it is a prerequisite that the principal SEM executive’s application for a Provisional Residence Permit has already been duly approved and that the executive holds a valid and subsisting residence permit for a period of five (5) years. Only under such conditions may the spouse apply for a work permit in accordance with the immigration and labor legislation in force in the Republic of Panama.
This Work Permit shall initially be issued for a term of two (2) years. Thereafter, it may be renewed successively for periods of three (3) years, pursuant to the regulations established by the Ministry of Labor and Labor Development (MITRADEL).Following the implementation of this regime, there has been a significant increase in applications of this nature, evidencing Panama’s intention to promote foreign investment not solely through economic incentives, but also by creating a favorable environment for expatriate families. This framework facilitates family integration, allowing not only the executive but also the family unit to achieve stability and quality of life in Panama. By enabling both spouses to lawfully engage in remunerated activities, household financial burdens are alleviated, and overall family welfare is enhanced.
For multinational companies, this measure constitutes an additional advantage when structuring competitive relocation packages. For family members, it represents the possibility of continuing their professional development without prolonged waiting periods or overly burdensome processes. Ultimately, this legal mechanism establishes a “win-win” relationship with the Republic of Panama, since many spouses of executives are highly qualified professionals who can contribute positively to the Panamanian labor market, thereby strengthening investor confidence and consolidating Panama’s standing as an attractive destination for foreign direct investment.
Authorship: LORENA DONADO
EN 
ES