Panama: Companies’ Closing Procedure – COVID-19

By Executive Decree No. 500 of March 19, 2020, the temporary closure of commercial establishments and natural or legal person’s companies have been ordered throughout our national territory, as a sanitary measure to prevent the spread of the new COVID-19 virus and, through Executive Decree No. 81 March 20, 2020, the procedure to be followed for said closure is established.

All companies which closure has or has not been ordered, may request the suspension of the effects of the work contracts, through the email address, which has been enabled by the institution since March 20th, 2020.

The following documents must be attached to the email:

  1. Note or memorandum justifying the suspension of employment contracts, signed by the legal representative of the company, requesting the suspension for up to one month, extendable period;
  2. Simple copy of the employer’s comercial license;
  3. Simple copy of the last pre-prepared payroll sent to the Social Security Fund, prior to the closing of the company;
  4. Suitable proof of the economic affectation, and;
  5. List of workers whose contracts are requested to be suspended, specifying name, identity card, social security number, residential address, occupation, sex, age, telephone number and email.


Those companies which closure has not been ordered by Executive Decree No. 500 of March 20, 2020, must manage for each of their workers the corresponding safe-conduct, which must be processed by accessing the following website:

Quijano y Associates is at your disposal to provide your company with the legal advice required to comply with all the provisions adopted by the Miinistry of Labor in view of the health crisis  our country is facing due to the global pandemic of the Covid-19 virus.

However, the following activities are exempt from the application of the Decree:

1. The entire production, distribution, marketing and sales chain of:

a. Food: food processing plants, packers and distributors, supermarkets, hypermarkets, grocery stores, and packaging companies.

b. Medicines and hygiene products (Drugstores)

c. Security equipments.

d. Construction materials (Hardware stores, manufacture and distribution of gas and water tanks).

e. Veterinary and agricultural supplies

f. Maintenance, operation and distribution of medical equipment companies.

g. Manufacturers of packaging and supplies of all the sectors above listed.

h. Printshops.

i. Laundries.

2. Everything related to maritime, land and air transportation, logistics and the Panama Canal, such as airports, services and repairs to ships, aircraft, ports, customs brokers, Panama Subway (Metro de Panamá), MiBus, transportation companies that have been hired to mobilize employees of companies included in the curfew exceptions, transportation service companies and workshops, wood export transportation, transportation of fuel and gas, maintenance of cars and auto parts, fuel and gas stations.

3. Everything related to security (private security).

4. Lawyers in the exercise of the defense of people arrested during the curfew period.

5. Restaurants only for home delivery or take away orders.

6. Fuel distribution, supply and transport companies.

7. Everything related to Banking, finance, cooperatives, insurance and other financial services. Including providers of electronic transactions, checks and images processing to financial institutions.

8. Companies that provide public services:

a. Communication Transportation.

b. Call Centers.

c. Gas stations and all companies in the supply chain of liquid and gaseous fuel.

d. Light and electric energy.

e. Industry of generation, transmission, distribution and operation of energy.

f. Cleaning companies.

g. Provisioning and distribution of water destined to serve populations.

h. Sanitary.

i. Hospitals.

j. Private clinics.

k. Veterinary clinics.

l. Funeral homes, cremation rooms, cemeteries.

9. Construction industry including manufacturing, distribution and dispatch of concrete, cement and its derivatives, quarries.

10. Agricultural industry including agricultural work. As well as the Agri-Food Industry, including food and beverage distribution centers.

11. Medical-hospital equipment, medications, vaccines and any other items and public health supplies, including manufacturing, suppliers and maintenance thereof.