Bill 633.

Summary.

The bill establishes rules for arranging, using, and monitoring loans, lines of credit, sovereign guarantees, and other international financing arrangements entered into by the Panamanian State. It would apply to arrangements authorized by a Cabinet Council decree or another legal instrument in force, to the Ministry of Economy and Finance (Ministerio de Economía y Finanzas), and to public entities that receive, administer, or use those funds. Their management would be governed by the principles of proactive transparency, legality, expenditure traceability, efficiency, fiscal responsibility, accountability, corruption prevention, and public participation.

Loan and international financing agreements would have to be published in full on a publicly accessible portal within 30 business days of signing. The publication would include amounts, currency, disbursements, financing costs, terms, purpose, responsible parties, safeguards, and subsequent amendments. Before arranging financing, the Ministry of Economy and Finance and the proposed recipient entity would publish a technical report on its necessity, its relationship to the public borrowing strategy, its expected impacts, and its risks and mitigation measures.

The bill creates the Public Registry for the Traceability of International Loans (Registro Público de Trazabilidad de Préstamos Internacionales) to link each agreement to the funded program or project, its budget allocation, public procurement processes, payments, and results and performance indicators. It restricts use of the funds to the expressly authorized and agreed purposes, programs, and projects. Implementing entities would publish a detailed report within 60 calendar days after the first disbursement and update it every six months. They would also maintain a public dashboard on their websites with current information on physical and financial implementation. All procurement financed in whole or in part with these funds would be expressly identified and published in open, easily accessible formats; its tender documents and contracts would include fraud and corruption prevention clauses, audit rights, and grounds for contract termination.

Each financing arrangement would be subject to annual financial and compliance audits and an audit upon project completion, with public reports. The Ministry of Economy and Finance would submit a public report each year to the National Assembly (Asamblea Nacional), no later than March 31, on the balance and changes in debt associated with loans and lines of credit, increases in those loans and lines of credit, payment projections, debt reduction measures, fiscal sustainability, and risks. The National Authority for Transparency and Access to Information (Autoridad Nacional de Transparencia y Acceso a la Información) would oversee compliance, without affecting the powers of the Office of the Comptroller General of the Republic (Contraloría General de la República) and other oversight bodies. Noncompliance would give rise to liability under current law and, if repeated or intentional, to administrative penalties under Law 6 of 2002. The Executive Branch (Órgano Ejecutivo) would issue regulations for the proposed law within six months. Its provisions may be of interest to implementing entities, international lenders, and contractors on public projects.