Chapter III, Section One

ORGANIC LAW PANAMA CANAL AUTHORITY
PANAMA LEGISLATIVE ASSEMBLY
LAW No. 19
(of June 11, 1997)
"WHEREBY THE PANAMA CANAL AUTHORITY IS ORGANIZED"

Chapter III - Patrimony, Finances, and Oversight,

Section One - Patrimony and Budget


Article 33. The following shall constitute the patrimony of the Authority:

  1. The installations, infrastructure, buildings, equipment, and other personal or real property assigned for the operation of the Canal, received by the Republic of Panama as a result of the transfer of the Canal, such as electrical power plants and water purification plants, piers and docks, dry docks, radio stations, telemetric and hydro-meteorological stations, dredge spoil areas, spillways, lighthouses, buoys, and other aids to navigation, workshops, pipelines, vessels, cranes, locomotives, engines, vehicles, machinery, parts, spare parts, materials, furniture, all type of control systems, computer and communication systems, and, in general, the installations, systems, components, parts, and other assets, as long as, in the judgment of the Authority, they are necessary or pertinent for the operation and modernization of the Canal.
  2. Revenues received from tolls, fees, and rates for use of the Canal, for the activities of the Authority, and for the services it may render.
  3. Revenues derived from the concessions it may grant and other contracts it may enter into, pursuant to the corresponding legal and regulatory provisions.
  4. Any other property and rights generated directly or indirectly by the operation of the Canal, or from the use or lease of any property that is part of the patrimony to which this article refers.
  5. Revenues from the sale of personal or real property incorporated into its patrimony, whenever said sale is authorized because the property is no longer needed for the operation of the Canal.
  6. Revenues generated from the use of the installations, personal, and other (types of) property along the banks of the Canal, its waters, or its adjacent areas, or that are part of its patrimony.
  7. Any other property, rights, or assets assigned to it by the Law, the State, municipalities, international organizations, autonomous Government entities, workers, or corporations.

Article 34. The Authority shall maintain a general inventory of its patrimony, with an appraisal of all the property in it. Both the inventory and the appraisal shall be updated as provided by the Board of Directors.

Article 35. The Authority shall operate in accordance with a three-year financial planning and management cycle, with yearly execution and controls, not precluding that by reason of its activities relative to international maritime trade, it may prepare projections for longer periods.

Article 36. The annual budget of the Authority shall be prepared in advance as established in the Regulations. The beginning and ending dates of the fiscal year shall be stipulated therein. The budget of the Authority will not be a part of the General Budget of the Government, nor will the provisions of the General Budget of the Government be applied to the budget of the Authority.

The Regulations shall provide the necessary mechanisms and procedures to make the required adjustments between the revenues and expenditures of the Authority when a budget deficit has occurred or may occur in a specific fiscal year.

Article 37. The Authority shall forward its draft budget to the Cabinet Council. After granting their approval, they will forward it to the Legislative Assembly.

Once the draft budget has been examined by the Legislative Assembly, it may only approve or reject it. An absolute majority vote of its members is required to reject it. In such an event, the budget of the previous year shall remain in effect with the changes and adjustments the Board of Directors may make, as proposed to and approved by the Cabinet Council, to ensure the continued safe, uninterrupted, efficient, and profitable operation of the Canal.

If a vote on the Authority's budget is not held by the first day of the corresponding fiscal year, the draft budget proposed by the Authority shall become effective, and shall be adopted by a decision of the Cabinet Council.

In both cases, the items in the draft budget relative to the Authority's public debt, the labor and contractual obligations it must meet, and investment financing shall be automatically approved.

Article 38. Should it be necessary to incur an expense not contemplated in the annual budget, and it is urgent and necessary to maintain the uninterrupted operation of the international public service provided by the Canal, the Administrator shall make the required disbursements and will recommend the corresponding budget adjustments to the Board of Directors.

Section Two: Payments to the National Treasury