The Colon Free Zone, located at the Atlantic entrance to the Panama Canal, is the focal point for sea and air cargo transportation in the hemisphere. It is considered a unique entrepot of world commerce.
The annual volume of business is approximately US$20 billion and there is a substantial number of companies established in the Zone from U. S., European, Asian and other origins. Merchandise is received in bulk duty free, subsequently repacked, labelled, assembled, manufactured (as the case may be) and reshipped in smaller quantities to customers in a wide area. Companies operating in the Colon Free Zone do not require a commercial license.
Operations in the Colon Free Zone may be conducted through any of the following methods:
Companies established in the Colon Free Zone might have three types of income subject to different income tax consequences: