Colon Free Zone
Colon Free Zone (CFZ) is the premier free trade zone in the western hemisphere. Created in June 1948, the Colon Free Zone has served for more than 69 years as the major trading center for Latin America and the Caribbean. Its operations began in a segregated area of 35 hectares originally in Colon Downtown and with 10 companies. Now, this free trade zone is divided into nine different sectors totaling 1,064 hectares for exhibition with more than 1,800 companies.
The main objective of Colon Free Zone is to promote international trade under a tax exempted work frame most of the commercial activities are wholesale oriented, and logistics and banking activities support them.
Colon Free Zone is located in the middle of the Americas at the Atlantic entrance of the Panama Canal, specifically at Colon City, becoming a natural distribution center (DC) serving to the regional market of Central America, South America and the Caribbean. It is surrounded by four containerized seaports, two cruise terminals, an international airport and a railroad terminal.
Colon Free Zone is strategically located to serve the regional market. By connecting the major suppliers from Asia, Europe and North America, the CFZ stores and redistributes tax exempted merchandise to the rest of the continent.
This free trade zone takes advantage of a highly connected multimodal platform. Four container seaports located in Colon and one in Panama City interconnected by a modern railroad network provide maritime connectivity to the global market. These are Manzanillo International Terminal (MIT), Colon Container Terminal (CCT), Cristobal-Panama Ports Company (PPC), and Colon Port Terminal (CPT) at the Atlantic side, and Balboa-Panama Ports Company (PPC) at the Pacific side.
This multimodal platform is interconnected with a road network of highways and corridors between both metropolitan cities.
Facts and Figures
|Colon Free Zone (Down Town)||91.05|
|20 de Diciembre||4.6|
|Airport Development Area||288|
|Coco Solo Expansion Area||228.94|
|Connectivity to other logistics assets|
|Number of active companies *|
|Long termn employment (by companies)||18,632|
|Temporary employment (by companies)||2,380|
|Gross domestic product|
|Contribution to the National GDP (Percentage)*||2.8|
|Source *: Zona Libre de Colón 2020.|
Colon Free Port
The Special System of Puerto Libre was created as a tool to encourage private investment in infrastructure and commercial activities in the city of Colon, province of Colon and thus, boost the generation of jobs and economic activity in this province. The first project of Colon Puerto Libre is the construction of Colon 2000 Duty Free.
This special system applies the Law 7 of April 4, 2016, which modifies and adds articles of Law 29 of 1992, with the purpose of implementing this regime.
Commercially, it is implemented in June 2017, through a web portal that allows the sale of goods that are protected by the special tax and customs system “Puerto Libre”. The products marketed range from appliances and technological items to clothing, shoes, jewelry, among others.
The beneficiaries are all Panamanian citizens and residents, as well as tourists and passengers in transit who wish to go shopping.
Benefits for Investors:
- 0% import tax on equipment and materials used to remodel or restore properties.
- 0% real estate transfer tax for 2 years.
- 0% property tax for 30 years.
- 0% income tax for 10 years on profits.
- Tax credits for financing.
Investment business activities:
- Import tax exemption for equipment and material used for its operations.
- Exemption of capital tax or notice of operation.