BENEFITS
Foundations enjoy certain legal advantages that make them attractive for extraterritorial use.
- They are exempt from all taxes, contributions or encumbrances in the Republic of Panama (except for the payment of the Annual Fee of US $ 300.00). Consequently, they do not pay income, estate, real estate, inheritance or transfer taxes.
- The Private Interest Foundations Act establishes that members of the Founding Council (who are also called "Directors"), the Protectors or Supervisors, as well as the Resident Agents and any persons or institutions that, by reason of their functions, obtain related information With the activities, transactions or operations of the Foundation of Private Interest, will always be obliged to keep strict secrecy, even after its extinction. Failure to comply with this rule is punishable by imprisonment of up to six (6) months and a fine of up to US $ 50,000.00, without prejudice to the corresponding civil liability.
- There is no legal requirement to disclose the names of the true founders, the beneficiaries or the protectors.
- No annual income tax return or financial statement is required.
- The law does not oblige to hold annual meetings of the Founding Council, the founders or the protectors or inspectors.
- Quick constitution procedures.
- Simple administration procedures.
- Reasonable prices for incorporation and maintenance.
- There is no legal requirement for maximum founding patrimony.
Creation of
Panamanian Foundations
Created by law N ° 25 of June 12, 1995, this legal figure, is very attractive because of the advantages that offer for the extraterritorial use (offshore).
Panama currently has a solid and stable democracy.
- There is no limitation in terms of perpetuities, accumulation of capital, and other restrictions that do operate in similar legal figures of other jurisdictions, such as the Anglo-Saxon trust.
- They can carry out any transactions of a civil nature or commercial nature (in an unusual way) in any country of the world and in any currency.
- The founders, members of the Founding Council, beneficiaries and the protectors or inspectors may be natural or juridical persons, of any nationality and domicile.
- The members of the Founding Council need not be founders.
- The founders, the protectors or inspectors and the members of the Founding Council can be beneficiaries of the Foundation.
- There is no limitation of maximum number of founders, counselors, beneficiaries or protectors.
- Founders and members of the Founding Council may hold their meetings in any country and may be represented in them by proxy.
- Foundational and accounting books can be maintained in Panama or abroad.
- The Founding Act may be signed by the client or by a fiduciary proxy, without the need to disclose the name of the principal.
- Foundations incorporated in other countries can be redomiciled or continue to exist as Private Interest Foundations of Panama, and vice versa, following a simple procedure of continuation.
- In Panama, the US dollar circulates freely as a legal tender and there is very strict legislation on bank secrecy.
- The contributions to the Founding Patrimony do not have to be deposited as a requirement for the foundation of the Foundation and there is no maximum period of time to provide said patrimony.
COMMON USES OF PRIVATE INTEREST FOUNDATIONS
Protection of defenseless persons. One of the most common uses of a Private Interest Foundation is the protection of persons such as minors, incapacitated or unskilled persons to manage their own property or exposed to the danger of losing their property.
In those cases where family businesses pass to the second and third generations, there is a risk that they will be fragmented into the hands of third parties, outside the family. For this, the Private Interest Foundation serves for the preservation and continuity of family businesses.
To administer the individual payment of sums of money, or the individual distribution of goods, to members of one or more families for their subsistence; Education, clothing or other living expenses, or as a mechanism to involve the children and / or grandparents. For this type of purpose the Foundation of Private Interest is denominated in Europe "Family Foundation".
To carry out activities for scientific, humanitarian, philanthropic, religious or charitable purposes, or to administer funds for these activities.
For a combination of the two purposes above, that is, for the benefit of the family and other persons or institutions. For this type of multiple purposes, the Private Interest Foundation is often called in Europe "Joint Foundation".
VACCARO & VACCARO Standard Founding Act creates this type of Foundation.
Given that the Panamanian Private Interest Foundation does not have to be exclusively limited to the family benefit, it is typically used to distribute goods or profits to other individuals (friends or loved ones) designated as beneficiaries of the foundation, either from The time of its creation, in a later period designated by the client, or in the event of the dissolution of the Foundation.