Summary.
Article 1 proposes approving in full Addendum No. 1 to the Contract between the State and the City of Knowledge Foundation for the establishment and development of the City of Knowledge, approved by Decree Law No. 6 of February 10, 1998. The addendum received a favorable opinion from the Cabinet Council (Consejo de Gabinete) through Resolution No. 8 of February 24, 2026. Its background provisions state that the contract has no expiration date and describe the exemptions under Clause Five, whose initial term was 25 years. They also recount actions by the Ministry of Economy and Finance (Ministerio de Economía y Finanzas), the Ministry of the Presidency (Ministerio de la Presidencia), and the Directorate General of Revenue (Dirección General de Ingresos) concerning compliance with contractual obligations and the extension of the benefits.
The addendum replaces Clause Five and proposes granting the City of Knowledge Foundation and entities established for the purposes of the City of Knowledge tax benefits for an additional term from February 13, 2023, through December 31, 2027, subject to the Foundation’s compliance with its contractual obligations. The benefits include exemptions from import taxes and charges on goods needed for the project, the Tax on the Transfer of Movable Goods and the Provision of Services (Impuesto a la Transferencia de Bienes Corporales Muebles y la Prestación de Servicios, ITBMS) on certain acquisitions, real estate tax on the Foundation’s property, and charges on transfers of money abroad made for the project’s purposes. Goods imported under an exemption must remain within the project area; their sale or transfer requires the State’s prior written authorization or payment of the applicable charge. The relevant information must be recorded on the Customs Declaration and Assessment form.
The same clause provides benefits for innovative companies that produce, assemble, or process high-technology goods, or provide services of that kind, in technology parks. For their operations within the designated areas, it provides exemptions from direct taxes, contributions, fees, duties, and national charges, and exempts their capital from national direct tax, including patent or license taxes. Recognition of these benefits requires an application and compliance with legal requirements. An Advisory Committee (Comité Consultivo) comprising officials, businesspeople, academics, and researchers will issue an opinion on the selection of companies to be located in the Technology Park.
To access the exemptions, the City of Knowledge Foundation must submit an updated list of affiliated companies to the Directorate General of Revenue of the Ministry of Economy and Finance. The list must include taxpayer identification numbers, contact information, and a mechanism for reporting additions and removals; it must be submitted within the first 30 days of the following fiscal year. The Foundation must also report and document the beneficiary companies’ economic activities.
The addendum creates a commission chaired by the Ministry of the Presidency and also comprising the Ministry of Economy and Finance, the Ministry of Foreign Affairs (Ministerio de Relaciones Exteriores), the Ministry of Commerce and Industries (Ministerio de Comercio e Industrias), the National Customs Authority (Autoridad Nacional de Aduanas), the City of Knowledge Foundation, and the National Secretariat for Science, Technology and Innovation (Secretaría Nacional de Ciencia, Tecnología e Innovación). It will review the contract and, if it considers it appropriate, propose amendments within 9 months of the addendum’s formalization and publication in the Official Gazette. The remaining clauses stay unchanged. The addendum requires approval by the National Assembly (Asamblea Nacional) and countersignature by the Office of the Comptroller General of the Republic (Contraloría General de la República); Article 2 provides that the law would take effect upon promulgation. The provisions concern the public entities named, affiliated companies, and the technology, research, and foreign trade sectors associated with the City of Knowledge in Clayton, Ancón township, Panama district, Panama province.
What it proposes.
- Approval of an addendum to the contract for the establishment and development of the City of Knowledge.
- Term and conditions of the tax benefits provided under Clause Five of the contract.
- Tax information on affiliated companies and review of the contract.
Who it would affect.
- City of Knowledge Foundation.
- Entities established for the purposes of the City of Knowledge.
- Innovative companies in technology parks that apply for the benefits.
- Public entities responsible for reviewing the contract and monitoring tax matters.
Key points.
- Approves Addendum No. 1 to the contract approved by Decree Law No. 6 of February 10, 1998.Art. 1
- Amends Clause Five to set an additional term for tax benefits from February 13, 2023, through December 31, 2027, subject to the Foundation’s compliance with the contract.Art. 1
- Establishes exemptions from import taxes, ITBMS, real estate tax, and charges on transfers of money abroad for the project’s purposes.Art. 1
- Places conditions on the disposal of goods imported under an exemption and regulates benefits sought by innovative companies in technology parks.Art. 1
- Requires the Foundation to provide the Directorate General of Revenue with an updated list of affiliated companies and documentation of their economic activities.Art. 1
- Creates an interinstitutional commission to review the contract and, if it considers it appropriate, propose amendments within 9 months.Art. 1
- Makes the addendum’s validity subject to approval by the National Assembly and countersignature by the Office of the Comptroller General of the Republic; provides that the law takes effect upon promulgation.Arts. 1-2