Colón Free Zone
The Colón Free Zone (Zona Libre de Colón) is a large free trade zone at the Atlantic (Caribbean) entrance of the Panama Canal, in the city of Colón. One of the largest free zones in the world and the biggest in the Western Hemisphere, it is a major hub for importing, storing, re-packaging and re-exporting goods duty-free throughout Latin America and the Caribbean.
Within the zone, companies can bring in goods (electronics, apparel, pharmaceuticals, general merchandise) without paying Panamanian import duties or taxes, hold and consolidate them, and re-export them to markets across the region — using Panama's central location and canal-side ports as a distribution platform. Duty applies only if goods enter Panama's domestic market. The Colón Free Zone leverages Panama's position as a maritime and logistics crossroads to serve as the region's wholesale re-export center. For companies distributing to Latin America, the zone offers duty-deferred warehousing and regional reach. Understanding it is part of structuring Latin American trade and distribution. It is a cornerstone of Panama's role as the Americas' logistics hub.
The Colón Free Zone turns Panama's canal-side position into the wholesale re-export hub of Latin America — goods flow in duty-free, are stored and consolidated, and re-export across the region without touching Panamanian duty. For companies distributing to Latin America and the Caribbean, it offers duty-deferred warehousing and regional reach, anchoring Panama's logistics-hub role.
What is the Colón Free Zone used for?
Importing, storing, consolidating and re-exporting goods duty-free across Latin America and the Caribbean, using Panama as a distribution platform.
When is duty payable?
Only if goods leave the zone into Panama's domestic market; goods re-exported remain duty-free.