General Information About Panama Private Interest Foundations

History of Panama Private Interest Foundations

The Panama Private Interest Foundation is a cross-breed between a trust and a corporation, yet, it is neither.  A Foundation is different from any other legal entity known in British and American laws because it is not a person or group of persons (as with a corporation).  It is a legal entity that does not have owners (share-holders, participants, or partners), and traditionally has a specific purpose for the benefit of a general group of individuals (like a family).

The notion of a "Foundation" began during the Roman Empire, under the influence of Christianity. The Roman Catholic Church was considered a divine foundation, and the various sub-organizations within the church had the legal control for administrating its' wealth. The original foundations were not created to serve a private need for a specific individual or family.  They were created for serving the needs of a community.  Many centuries later, the legal entity known as a "Foundation" continues to exist and is widely used and accepted around the world for personal and private needs.

The model of a "Private Interest Foundation" began when the Principality of Liechtenstein created the "Law of Persons & Companies" in 1926 (Personen und Gesellschaft Recht - P.G.R.). This law created the "Family Foundation" (for the private benefit of the members of one or more families) and the "Mixed Foundation" (for the private benefit of not only families, but also for other persons or institutions).

For many years, wealthy families in Europe have established Family Foundations incorporated in the Principality of Liechtenstein for the purpose of estate-planning, to ensure the safe transfer of assets to the family's beneficiaries.  Today, Liechtenstein Foundations can cost upwards of $25,000 to incorporate, and up to $10,000 per year to maintain.

The Panama Private Interest Foundation was developed based on the Private Interest Foundation models from three different jurisdictions including the Principality of Liechtenstein, Switzerland, and Luxembourg.  The Panamanian Government carefully constructed the Panama Private Interest Foundation with the intentions of creating a more modern, flexible, and affordable estate planning tool for people from around the world.  The assets of the Panama Private Interest Foundation have a separate legal identity from the personal assets of the Founder, Protector, Council, or Beneficiaries.

The Panama Private Interest Foundation provides the ultimate in privacy, anonymity, and protection to its Protectors, Founders, and Beneficiaries.  The Panama Foundation offers affordable, anonymous, flexible, private, estate planning instrument used to hold Panama assets such as corporations, trusts, bank accounts, investment accounts, real estate, or any other type of global asset.

A Panama Private Interest Foundation is created when registered in Panama’s Public Registry.  No approval from any government authority is required.  Law No. 25 of 1995 regulates Panama Private Interest Foundations.

Popularly known as a Panama Foundation or Panama Foundations can also be used for Estate Planning where the Founder transfers title of current assets to the Foundation and uses the Panama Foundation to acquire Panama assets and open Panama bank accounts and Panama brokerage accounts.

A Panama Foundation offers global estate planning and asset protection by owning the shares of Panama Corporations which owns the assets.

We can help you create a Panama Private Interest Foundation depending on your particular estate planning and asset protection needs.

Features of a Panama Private Interest Foundation

The composition of the Panama Private Interest Foundation consists of four main members:

Founder: The founder is the person or entity that creates the private interest foundation by filing the documents in Panama’s Public Registry.  To keep your name out of the Public Registry, our law firm generally provides a nominee founder, and provides you with a pre-signed, undated letter of resignation from the founder immediately after creation of the foundation.

Foundation Council: The council acts the same way as a board of directors do to a corporation.  The council members’ names and passport numbers are filed with the public registry when the foundation is created.  Our law firm generally provides a nominee council, and provides pre-signed, undated letters of resignation from the nominee council.

Protector: The Protector is the eventual controller of the Panama foundation.  The council appoints a Protector with a notarized Private Protectorate Document immediately after the foundation is created.  Since the document is private, and unregistered, the Protector remains 100% anonymous. From that point on, the Protector has full control over the foundation and all of its assets including all bank and brokerage accounts in its name.

Beneficiaries: The Protector writes a private Letter of Wishes appointing the Beneficiaries. The Letter of Wishes is a private document, so the beneficiaries remain 100% anonymous.  Only the Protector the can change or modify the Letter of Wishes.  The Letter of Wishes is similar to a living will for the Panama Foundation, which explains who the beneficiaries are, what the assets include, and how the assets are to be distributed to the beneficiaries and upon what triggering event (such as the death or incapacity of the Protector).

The Panama Private Interest Foundation serves five primary purposes:

1. Provides total Anonymity by acting as a holding entity for your offshore Panama Corporation: Using the Private Interest Foundation avoids the use of corporation bearer shares and/or corporate shares issued in your personal name.  The Private Interest Foundation can be the shareholder on the share certificates of one or more offshore corporations.  You control the foundation anonymously through a Private Protectorate role.  As Protector, you appoint the beneficiaries through a private Letter of Wishes (or a more formal set of foundation By-Laws). Since both the Protector and the Beneficiaries are appointed through non-public (private) documents, they remain 100% anonymous and confidential.

2. Is an asset protection tool to protect your assets to the greatest extent of the law: Under the Panamanian foundation law, the Panama Foundations assets are "non-embargable", and "non-sequesterable", meaning that no one can freeze the assets, or place liens on the assets, which makes the Panama Foundation a critical offshore asset protection vehicle.

3. Is the beneficial owner of your offshore corporation when opening offshore bank accounts: Because of the global terrorism threat, most offshore tax haven jurisdictions created laws requiring their banks to obtain "declarations of beneficial ownership" when opening corporate offshore bank accounts.  In most offshore jurisdictions, such as Panama, the banks are required to maintain this information under the upmost confidentiality pursuant to their bank secrecy laws which are strictly enforced.  However, clients who do not wish to declare themselves personally as the beneficial owner when opening corporate offshore bank accounts, the foundation can serve as the beneficial owner / shareholder for the corporation.

4. Acts as a testamentary tool for distribution of your assets to your heirs: The Panama Private Interest Foundation is specifically designed to protect and distribute your assets to your beneficiaries upon a triggering event, such as your death or incapacity. Your Panama foundations Letter of Wishes, written by the Protector, will serve as its "living will", controlling the foundations assets, listing the beneficiaries, and how and when those assets are to be distributed to the beneficiaries.  Panama laws allow the Panama Private Interest Foundation to provide your heirs with their inheritance free of probate, gift taxes, estate taxes, inheritance taxes, or legal delays.

5. Acts as a tool to facilitate the transference of funds offshore: The Private Interest Foundation may receive private donations, and it may give donations/grants, etc. to anyone the Protector chooses.  Therefore, you can privately donate your funds to the Panama Private Interest Foundation.  Then the Private Interest Foundation can provide educational grants, charitable donations, etc. to anyone you choose.  Please note, however, that the Panama Private Interest Foundation may not publicly solicit donations.

Advantages of Panama Private Interest Foundations

There are several uses for a Panama Private Interest Foundation.

Advantages of a Panama Foundation

Panama Private Interest Foundations may be created for the benefit of a person or persons, a family, or a specific social purpose.

In general, Panama Private Interest Foundations are used by people who wish to control and maintain ownership of foreign corporations without owning their corporations themselves directly. This may be due to the Controlled Foreign Corporation (CFC) rules in their home countries.  Several highly taxed countries such as the United Kingdom, Canada, the United States, Australia, New Zealand, France, Italy, Spain, etc. have CFC rules requiring that their citizens file declarations (reports) to the appropriate tax authorities where they declare that they are the shareholders of such foreign corporations.

Instead of holding the corporations' shares in their personal name or in bearer form, they create a Panama Private Interest Foundation which holds or owns the shares of their foreign corporation(s), thus avoiding the CFC reporting rules.  Therefore, the advantage of using the Panama Foundation as a shareholder for their corporation is to remove ownership from one's personal name (or through a Bearer Share arrangement), and transfer ownership to the name of a foreign entity which does not have owners and is completely anonymous.  In this way, there is no question as to who owns the company, since the company's shares are issued to the Panama Foundation name.

Another advantage of utilizing the Panama Foundation as a shareholder arises in the following case:  Financial institutions require that you reveal the beneficial owners of the corporation when opening corporate bank accounts or investment accounts. Through this strategy, one can honestly state that the Panama Foundation is the owner of the corporation.  Again, the objective is to remove ownership from their personal name, to the name of a foreign entity whose ownership is anonymous.

There are other advantages other than just ownership. For instance, the Panama Foundation can be useful in transferring funds offshore or receiving funds from offshore.  In other cases, some people donate their funds to their Panama Foundations and later use the Panama Foundation to give educational or special grants to their children, grandchildren, or anyone else they choose.  The advantage here is to avoid fiscal regulations regarding donations, where some governments impose "gift taxes" and exhaustive reporting requirements.

In general, Private Interest Foundations may not engage in typical profit-making commercial activities as a corporation can.  However, they can engage in commercial activities from time to time, as long as the profits of those activities are used for the objectives of the foundation.  For instance, a Private Interest Foundation may engage in banking or investment investments, such as investing in bank time deposits (Certificates of Deposit - CD's), stocks, bonds, mutual funds, options, money markets, etc. so long as the proceeds from these investment activities are for the benefit of the beneficiaries of the Panama Foundation.

Our Panama Private Interest Foundation Package Offer

Take advantage of our Exclusive Panama Foundation Package Offer!

We are currently offering this Exclusive Panama Foundation Package for only US$1,000 + $250 Tax + $50 international Courier Fee = $1,300 Total

Our Panama Foundation Package includes the following:

1. Panama Foundation - complete with:

a. Original Foundation Charter written in Spanish.

b. English Translation of Foundation Charter.

c. Resident agent.

d. Registered office.

e. Nominee council (directors) which is optional.

f. Notarized, pre-signed, undated nominee council resignation letters.

g. Notarized Private Protectorate Document.

h. Sample Letter of Wishes.

i. Panamanian Government Registration Fees for the first year.

Note: *Panama Foundations do not have corporate shares. In the alternative, Panama foundations include a notarized Private Protectorate Document. The Protector appoints the Beneficiaries through a Private Letter of Wishes.

2. General Power of Attorney - We will provide a notarized General Power of Attorney (with Apostil stamp) with a blank space so you can insert any name you want to appoint.  The person whose name appears in the Power of Attorney can then actually sign contracts, open and operate bank or brokerage accounts, and do all business on behalf of the Foundation.

3. Offshore Corporate Brokerage Account - with the following features:

a. Corporate Debit Card (optional) for access to cash via ATM's around the globe.

b. Multi-Currency Accounts.

c. Online Access for trading using secured password and user ID.

d. Access to investments in stocks, bonds, mutual funds, options, forex, commodities and money markets on all major securities exchange around the world.

e. Reputable, registered, licensed international brokerage firm with insured accounts.

f. English speaking licensed brokers on staff to provide investment advice or guidance.

* Add a Corporate Bank Account to the above package for only $700!

Corporate Bank Account includes:

a. Online Access to account.

b. Investments in time deposits (Certificates of Deposit).

c. Reputable, licensed, secure international bank.

d. English speaking customer service.

e. Corporate Credit cards available (optional) for access to cash via ATM's around the world and everywhere credit cards are honored.

Do your research and you will find others are charging 3 to 4 times more than us!

Note: Please add $50 to your order if you would like your documents sent by guaranteed 3 day worldwide Courier Service. Otherwise, your documents will be sent by regular mail, which may take up to 6 weeks for delivery.