Tensions have been high recently at the National Assembly as the Assembly members debated and passed a first version of Law 71. Due to the possible impact of this law, even the U.S. Embassy sent out an email notifying the expatriate U.S. community that the Embassy would be monitoring developments at the National Assembly.
So what is Law 71? It is a proposed law that would force owners of coastal lands and islands, who bought their land as a right of possession rather than legally titled, to title their land. The difference between rights of possession and legal title is that with the former you do not own the land, but actually lease it from the government. The benefit to the government of having property owners that have legal title is that they can then tax the property. The law would also assist in identifying property owners who grabbed land, saying it was rights of possession and who now want legal title to the land they never purchased. The feverish “land grab” that took place a few years ago in Panama has made it very difficult to figure out who owns what.
The big fear among property owners with rights of possession is that the government will pass a law which will allow the government to eliminate rights of possession and then seize the land. Realistically however, it is not likely that the Panamanian government wants to expropriate land but sees this as a way of increasing tax revenue which it has been striving to do with tougher tax collections since they came to power in July.
Understandably, many people are nervous about the proposed law, but we need to remember that it is just that, still a proposed law and we will all have to wait and see what it looks like in its final form.