A legislative initiative approved in its third debate by the National Assembly establishes an administrative procedure for the recognition of the statute of limitations on debts with banks and financial entities. This will allow debtors to directly request the extinction of these obligations when the legal period for their collection has expired. The bill creates an administrative pathway for clients to go to the entity they owe and request the statute of limitations once the established claims period has passed, without the need to initiate judicial proceedings, which are often lengthy and costly. The proposal is based on article 1652 of Panama's Commercial Code, which sets a three-year statute of limitations for actions arising from banking or financial contracts. After that period has elapsed without the creditor having taken collection actions, the debtor can formally request the recognition of that statute of limitations. The proponent of the initiative, Deputy Ernesto Cedeño, explained that the objective is to offer an administrative mechanism to extinguish debts that have exceeded that claims period. As he pointed out, in many cases, banks and financial institutions sell these defaulted portfolios to furniture stores or other collection agencies that continue to demand payments. “What we are establishing here is an administrative procedure through which, after this claims period has expired, the individual can go to who they owe and request that statute of limitations,” said Cedeño. The initiative was approved with 45 votes in favor and one against and seeks to facilitate that consumers can enforce the statute of limitations on a debt when the creditor has not taken collection actions within the established period. For the law to come into effect, it must be sanctioned by the president and published in the gazette.
