The Panama Canal Authority (ACP) is an autonomous legal entity of the Republic of Panama, established under public law, established under Title XIV of the National Constitution with exclusive charge of the operation, administration, management, preservation, maintenance, and modernization of the Canal, as well as its activities and related services, pursuant to legal and constitutional regulations in force, so that the Canal may operate in a safe, continuous, efficient, and profitable manner.

Organic Law of June 11, 1997, furnishes the ACP with legislation for its organization and operation. Because of its importance and uniqueness, the ACP is financially autonomous, has its own patrimony, and the right to administer it.

An Administrator and a Deputy Administrator head the ACP under the supervision of an 11-member Board of Directors. The Administrator is the highest-ranking executive officer and legal representative of the Authority, and is responsible for its administration and the implementation of the policies and decisions of the Board of Directors. The Administrator is appointed for a seven-year term, and may be re-elected for an additional term.

The appointment of the 11 members of the Board of Directors is made as follows:

• Nine directors are appointed by the President of the Republic of Panama with the consent of the Cabinet Council and ratification by an absolute majority of the members of the Legislative Assembly.
• One director is designated by the Legislative Branch, and may be freely appointed or removed thereby.
• The President of the Republic designates one director, who shall chair the Board of Directors and have the rank of Minister of State for Canal Affairs. The Canal Affairs Minister attends Cabinet Council meetings, having the right to voice and vote.

The members of the first Board of Directors were appointed for overlapping terms to ensure their independence from the country's administrations. The Panama Canal constitutes an inalienable patrimony of the Republic of Panama; therefore, it may not be sold, assigned, mortgaged, or otherwise encumbered or transferred. The legal framework of the Panama Canal Authority has the fundamental objective of preserving the conditions for the Canal to always remain an enterprise for the peaceful and uninterrupted service of the maritime community, international trade, and the Republic of Panama.