What Happened
The National Assembly approved Bill No. 306 on March 19 in its third debate, adopting new rules to limit aggressive debt-collection practices and strengthen consumer privacy protections. The measure, promoted by Vamos coalition deputy Yamireliz Chong, passed the plenary with 41 votes in favor.
Key Provisions
Lawmakers set explicit hours for collection contacts: Monday to Friday from 8:00 a.m. to 6:00 p.m., and Saturdays until 3:00 p.m., with contacts prohibited on Sundays, holidays and days of national mourning. The regulation also limits contact frequency: once a creditor establishes effective communication with a debtor, they may not attempt further contact that same day through other means unless previously agreed.
The bill prohibits workplace visits by collection agencies, a practice citizens say has led to job losses. It tightens protection of personal data by forbidding contact with family members, neighbors or other references to disclose debt information, except in cases where a debtor has been unreachable for 60 days, at which point agencies may seek contact information through third parties.
Transparency measures require original creditors to inform debtors when a debt is transferred to a collection agency and to provide the total amount owed, including interest and fees. Each transferred debt must be supported by an individual contract, intended to prevent the mass sale of portfolios without proper documentation.
Background
Chong said the proposal grew out of numerous citizen complaints collected in communities, where people — including some without debts — reported persistent harassment by collection agencies. She stressed the project ‘‘is much more than just schedules,’’ and noted the regulation was built in coordination with the Panama Banking Association to create a balanced framework for both creditors and debtors. A lawyer consulted during the bill’s preparation reportedly identified more than five related cases a week.
What This Means
Supporters say the law aims to guarantee ‘‘adequate, humane and fair’’ collection processes without encouraging non-payment. The rules address practices characterized as abusive — excessive calls, unauthorized home or workplace visits, and disclosure of personal debt information — and include provisions to protect consumers’ emotional and psychological integrity.
Creditors retain the right to recover debts, but must comply with the new limits on timing, frequency and methods of contact, and respect strengthened transparency and documentation requirements when transferring debts to collection agencies.