They are the only airline within the country and since there is no competion they do collect the fees. Now if you get in line and they are swamped because they have to get everyone on board I have been lucky enough to avoid having to pay for our overweight luggage. But I don't want to tell you to count on that because if it doesn't happen you might be pissed.
Most locals ship their luggage via Fletes Chavales. It's a transport company.
If you don't have that luxury and you have to use Air Panama pack light. They will collect the money if they can. And it's not the 50 pounds each that you will get with any airline coming into the country. I always mention the weight limits on luggage because its such a drastic weight limit reduction which is honestly not necessary since they are using Copa Airlines cast off planes so they can handle the weight, they just dont' want too.
Oh how everyone longs for the day that Air Panama has competition within Panama!