France - Panama Papers

Panama threatens France over ‘papers’ blacklist

anama President Juan Carlos Varela delivers a speech at Bolivar Palace in Panama City on April 6, 2016.
anama President Juan Carlos Varela delivers a speech at Bolivar Palace in Panama City on April 6, 2016. AFP file photo

Panama warned France on Tuesday of unspecified “diplomatic measures” if it doesn’t drop it from a blacklist of tax havens in the wake of the Panama Papers revelations.


“If France’s government doesn’t reconsider its position, Panama’s government will find itself obliged to take diplomatic measures,” President Juan Carlos Varela told reporters.

Panama Papers

Following the Panama Papers reports showing how a Panama law firm helped wealthy people from France and other countries stash their assets in offshore companies, Paris last week put Panama back on its national list of Uncooperative States and Territories (ETNC), from which it had removed it in 2012.

France is also urging the European Union and all member states of the Organisation for Economic Cooperation and Development to follow suit.

Such an international designation would deal a heavy blow to Panama’s vital financial services sector, upon which the Panamanian government recently imposed reforms to move it towards global transparency standards.

Varela said Panama was asking Paris, “strongly and respectfully” to take back its “wrong and unnecessary” decision to blacklist his country. Such a designation entails financial sanctions such as heavy French withholding taxes on transactions.

Panama’s laws also provide for retaliation in such cases that can lead to public tenders being withheld from companies from offending states.

Panama has mixed such threats with affirmations that it is open to discussing how to improve transparency, all in a bid to head off wider action against it.

Mossack Fonseca

The Panama Papers, centred on a huge cache of documents pilfered digitally from the law firm Mossack Fonseca, has had repercussions around the world.

Iceland’s prime minister was forced to resign after his name appeared as one of the beneficiaries of an offshore company. Britain’s prime minister has had to disclose his tax records.

Meanwhile, Panama police late on Tuesday raided the offices of Mossack Fonseca, the law firm at the centre of the “Panama Papers” scandal, to search for any evidence of illegal activities, authorities said in a statement.

The national police in an earlier statement said they were searching for documentation that “would establish the possible use of the firm for illicit activities". The firm has been accused of tax evasion and fraud.

Police offers and patrol cars began gathering around the company’s building in the afternoon under the command of prosecutor Javier Caravallo, who specialises in organised crime and money laundering.



- with AFP


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