Formation of pi-allyl Pd cation complex
This is a classic oxidative addition. You're kind of outside the classic world of single and double bonds. You have 4 electrons spread of 3 carbon atoms that link stabilize a bonding interaction with the palladium. Two of those electrons came from the palladium, so we think of it as having been oxidized, hence the name of the process.

See reference for general $\mathrm{S}_{N}2$ type oxidative addition. The only difference from your example is that the electrophile has a double bond that serves as an additional ligand for the palladium.