MEPs agreed on Wednesday to launch the investigation into revelations of detailed information on offshore companies and their ultimate beneficiaries.
The committee will probe alleged contraventions and maladministration in the application of EU laws by the Commission and member states on money laundering, tax avoidance and tax evasion.
The body will have 65 members and has been given 12 months to present its report. Its first formal meeting will take place before the summer break. The MEPs that will sit on the committee will be formally decided on 23 June.
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Meanwhile, German EPP group member Burkhard Balz said the group will demand that Mossack Fonseca, the Panama-based law firm at the centre of the scandal, together with senior representatives of the Panama government, to testify in Parliament as part of the investigation.
The EPP group has also called for registers of company owners
On Wednesday, Balz said, "We want to systematically end secrecy on who owns letter box companies."
Balz is the MEP who led the negotiations on the mandate for the Panama committee.
He said, "Nobody can explain why it should be a secret who owns a company. If somebody founds a company - be it in Europe, Panama or elsewhere - there must be no secrecy about it.
"A real entrepreneur is not ashamed of what he does", said Balz, who is also EPP spokesman on Parliament's special tax committee which was set up after the so-called LuxLeaks revelations.
"I am happy that we have a broad cross-party consensus on the basis of my proposal", Balz said.
If somebody founds a company - be it in Europe, Panama or elsewhere - there must be "no secrecy" about it, he argues.
"We want the committee to inquire into the inaction of member states which led to what the Panama Papers revealed. We also want to shed light on structural problems which make it so difficult to tackle the problem.
"Very often it is national egoism which paralyses international action against tax dodging and tax avoidance", Balz stressed.
"The EPP group wants Mossack Fonseca and the Panama government to testify in Parliament", Balz reiterated.