Private Interest Foundations
Private Interest Foundations are regulated by Law 25 of June 12, 1995; and by Executive Decree No. 417 of August 8, 1995. Developed based on models of Private Interest Foundations of three different jurisdictions, including those of the Principality of Liechtenstein, Switzerland and Luxembourg.
The Private Interest Foundation in Panama is mainly constituted to protect the assets of people who are unable to manage their own assets and guarantee the continuity of family businesses. In addition to this, they offer clear advantages for international estate planning, being the best option in terms of privacy, anonymity, and protection for the Protectors, Founders, and Beneficiaries of the Foundation. The Panama Foundation is a solution to a global need for accessibility, anonymity, flexibility, estate planning that can be used to hold assets such as partnerships, trusts, bank accounts, investment accounts, real estate, or any other type of asset.
Benefits and Uses
- Privacy: The anonymity and privacy of the beneficiaries are maintained, since their names do not appear registered in any public office.
- Easy Administration: Annual profits or financial statements are not required; Complete exemption from the payment of taxes on any commercial activity carried out outside the Republic of Panama.
- Flexibility: The Panamanian Foundation offers enough flexibility to transfer or manage an estate in favor of the same founder, or third parties, relatives, children or heirs.
- Transparent Succession: They have a fiduciary structure, for the orderly transfer and disposition of the assets to the beneficiaries, upon the death of the Founder, maintaining control of the assets for life.
- Protection: The inheritance rights that apply to the domicile of the founder or the beneficiaries are not effective against the assets of the foundation nor can these rights affect the validity or execution of the objectives of the foundation.
- It should be noted that one of the main characteristics and protection of the assets of a private interest foundation is that they cannot be seized by any entity unless it is proven that they come from illicit sources.
- Anonymity: The founder, if he wishes, can act through a company.
Regulations issued through a Private document: The beneficiaries and future guidelines of the foundation can be named through a private document called Regulations.
- Re-domicile: A Private Interest Foundation duly organized in another country can be re-domiciled in Panama and adopt Law 25 of 1995 as the legal provision applicable to it, through the registration of its founding instrument.
- Independent Legal Entity: A Private Interest Foundation constitutes an Independent Legal Entity and therefore can be the owner of movable and immovable property, as well as open its own bank accounts.