Bill 503.

Summary.

The bill establishes a framework for integrity and corruption prevention in the public finances of the Republic of Panama (República de Panamá). It covers the budget, expenditure, procurement, borrowing, guarantees, subsidies, and fiscal transparency. It relates these measures to the United Nations Convention against Corruption and the Inter-American Convention against Corruption. It would apply to public bodies, municipalities, and local councils when they use General State Budget resources or transfers from the Central Government (Gobierno Central); it would also cover funds, trusts, and private parties that contract with the State, receive benefits, or manage public resources. It defines governing principles and terms and provides for complementary application alongside budget, financial management, and procurement legislation.

For budget preparation, it requires accessible procedures and publication of key documents. The Executive Branch (Órgano Ejecutivo), through the Ministry of Economy and Finance (Ministerio de Economía y Finanzas), would regulate a citizen budget proposal and a fiscal risk statement. The ministry would prepare an annual integrity risk map for entities to incorporate into their planning. New expenditure, investment, or subsidy programs above thresholds set by regulation would include a public assessment of risks, controls, and coordination with the Office of the Comptroller General of the Republic (Contraloría General de la República). Budget amendments would require reasons, an account of their fiscal and integrity effects, and publication; certain amendments would require a specific report.

For expenditure, the bill requires records linking commitments, accrued obligations, and payments, with transactions traceable to supporting documents. It prohibits payment obligations without budgetary backing or timely registration, subject to statutory exceptions. Deliberate or negligent accumulation of irregular floating debt would constitute a serious administrative offense, without excluding financial or criminal liability. It favors electronic payments and calls for guidelines to reduce cash payments. Positions with high fiscal or integrity risk would be subject to merit based selection, training, possible rotation, and declarations of interests or assets.

State contracts involving payment obligations would need budgetary backing and entry in financial management systems. Procurement with a high fiscal impact would include a risk assessment in its preliminary studies. Debt transactions, guarantees, and sureties would require authorization, analysis of fiscal sustainability and risks, and entry in a public register administered by the Ministry of Economy and Finance. Financing, public-private partnership, and concession contracts would include integrity clauses, contractor controls, and State powers to review or terminate a contract when related acts of corruption are established.

The bill creates a public register of subsidies, transfers, and assistance, covering programs, criteria, beneficiaries, amounts, funding sources, and implementing entities, while protecting sensitive personal information. It requires previously published, verifiable criteria, audits, evaluations, and review of benefits. Public funds and trusts would publish financial and contractual information. A single portal would bring together budget, concession, debt, and subsidy data in open formats; budget information would be updated weekly, and entities would facilitate public and academic use.

It amends the purpose clause of Law 22 of June 27, 2006 and adds definitions of conflict of interest, integrity, and high risk procedures. It adds training, certification, disclosure, and possible rotation duties for procurement personnel; breach would be a serious administrative offense. It also requires publication of risk assessments for high risk procedures with their preliminary studies. The Executive Branch would issue implementing regulations within twelve (12) months and submit legislative harmonization proposals to the National Assembly (Asamblea Nacional). The provisions concern fiscal management and oversight bodies, State suppliers, subsidy recipients, and sectors involved in works, concessions, and public financing.