Countries › Panama › Guide › 14. Disputes

14. Disputes: Panama

Disputes in Panama: how commercial suits run under the oral Código Procesal Civil in force since 11 October 2025, how debts are collected through executive proceedings, how arbitration seated in Panama works under Ley 131 de 2013, how foreign awards and judgments are recognised by the Supreme Court Fourth Chamber, how cross border service and evidence work, what ICSID and the US Trade Promotion Agreement offer investors, how insolvency under Ley 12 de 2016 affects creditors, how to challenge the State, and the limitation periods that matter, each tied to the official text. Panama and Argentina are both New York Convention and ICSID members and approved a bilateral investment agreement in 1997; the Argentine side is covered in The Argentine Thread guide.

Investor view. A modern arbitration law, direct enforcement of awards, ICSID membership and a new oral civil procedure code give investors predictable tools to protect contracts in a dollarized economy built for international business.

• Disputes in Panama: courts under the new Código Procesal Civil, arbitration under Ley 131 de 2013, enforcing awards and judgments, and ICSIDCivil and commercial suits filed since 11 October 2025 run under the oral Código Procesal Civil of Ley 402 de 2023, which replaced Book Two of the Código Judicial; older cases finish under the old rul
• Commercial litigation in Panama under the Código Procesal Civil: courts by amount, ordinary and summary processes, hearings, appeals, cassation and costsSince 11 October 2025 new civil and commercial suits follow the oral Código Procesal Civil: municipal judges hear claims from B/.1,000 to B/.10,000 and circuit judges hear larger ones. The defendant h
• Debt collection in Panama: executive titles, payment orders, attachment, 8 day defences and judicial auction under the Código Procesal CivilA creditor holding an executive title, such as a public deed, a bounced cheque, a negotiable instrument, a bank balance certificate or an arbitral award, can skip the ordinary trial and ask the court
• Commercial arbitration seated in Panama under Ley 131 de 2013: the agreement, the tribunal, interim measures, the award and annulmentLey 131 de 2013 governs domestic and international arbitration seated in Panama: courts must refer covered claims to arbitration, the tribunal rules on its own jurisdiction, and it may grant interim m
• Enforcing arbitral awards in Panama: New York and Panama Conventions, the Fourth Chamber, closed refusal grounds and the most favourable treaty rulePanama acceded to the New York Convention on 10 October 1984, in force from 8 January 1985, with no reservations listed, and has approved the 1975 Inter American (Panama) Convention. Awards made abroa
• Enforcing foreign court judgments in Panama: exequatur at the Supreme Court Fourth Chamber, reciprocity and the four conditionsForeign money judgments are enforced in Panama only after the Supreme Court Fourth Chamber declares them enforceable, giving the debtor and the Attorney General 5 days each. Without a treaty, a judgme
• Cross border litigation with Panama: serving defendants abroad, letters rogatory, evidence, apostilles and proving foreign lawA defendant abroad with a known address is served by letter rogatory through diplomatic or consular channels and has 30 days to answer; if the request takes more than four months, the claimant can swi
• Investment treaty arbitration with Panama: ICSID since 1996, the US Trade Promotion Agreement, bilateral treaties and arbitration clauses in State contractsPanama has been an ICSID Contracting State since 8 May 1996 and its arbitration law tells the State to arbitrate disputes under ratified treaties without Cabinet approval. The Trade Promotion Agreemen
• Insolvency and creditor claims in Panama under Ley 12 de 2016: reorganisation, the financial protection stay, liquidation, clawback and cross border casesLey 12 de 2016, in force since 2 January 2017, replaced Panama's old bankruptcy rules with reorganisation and liquidation before specialised circuit insolvency judges for merchants and commercial comp
• Claims against the Panamanian State: administrative appeals, the two month silence rule, the contentious administrative jurisdiction and civil cases against the StateChallenging an agency decision starts with reconsideration or appeal within 5 business days; if the authority is silent for two months the request or appeal is deemed denied and the administrative rou
• Limitation periods and key filing deadlines in Panama: negotiable instruments, company and bank contracts, State claims, awards and how filing stops the clockActions on cheques, promissory notes, bills of exchange, company relationships, interest, finance leases, factoring and all bank or financial contracts prescribe in three years under Código de Comerci

Related: Panama country profile · live dashboard · central bank and release calendar · our posts on X