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 The Private Interest Foundation is another legal exclusively from Panama and the principality of Liechtenstein, it is a legal entity established to protect assets most of all for inheritance, however it is used as well to protect of legal process, divorces, as well it has been used just like legal trusts for education, gifts, donations, wills or anonimity
In this order, Private Interest Foundation are usefull to control nominee shares with the same effective or anonimity of bearer shares with the security of the nominee shares and there is no need of blank check, not anymore. Whenever you constitute any corporation you can protect your investment setting up a private interest foundation at the same time and the shares will be under private foundation's name. For further information contact us or please access to our book Offshore Business for Beginners in pdf
For business purposes you are a world citizen there is no need to pay income taxes if you are conducting business in differents countries than yours. See comparative graphic.
Panama Private Interest Foundation
A Panama Private Foundation is an entity created to protect assets, to give anonymity, privacy and estate planning purposes. As well these entities are created as share holders, giving the customer extra security and confidentiality.
Has its origin in the Law 25 of June, 12th of 1995 combining corporations and trusts benefits, however basicly in a trust framework. In the Panama Private Interest Foundation gets involved three components:
1. The founder: is a person or legal entity who submits the Foundation to the Public Registered previously presented into a Notary.
The Founder usually is the client or the person that the client designate. Frequently, if the client has not had previosly a corporation the founder is our company. The founder has the ability to change the Private Interest Foundation that is why is neccesary to complete an agreement for the customer, for the complete control of it.
That could be appointing a nominee Founder with full powers specifing his legal prerrogatives and a private contract between the client and Nominee founder.
2. The Protector: The Protector is optional, we strongly recommended that figure, if nominees are being used for the Founder and/or the Foundation Council.
The Protector, is the person who effectively controls the Foundation and administers the assets is such as the trustee in the Trust. The Foundation Council usually appoints the Protector through the Regulations or by a private document, so the name of the Protector is not in the public record. The Protector can replace the Foundation Council members at any time. The control is exercised by means of the protector.
The client or the person whoever designate is usually the Protector and he/she can have the Foundation Council appoint himself/herself or whoever is desired.
3. The Beneficiaries: A Panama Private Foundation does not have owners, instead of it, the ownership is with the Beneficiaries. The Foundation Charter and its Regulations specify how and when the Beneficiaries may receive benefits from the Foundation.
The Beneficiaries are appointed by the Protector or, if no Protector has been appointed, then by the Founder.
The Beneficiaries are not in the public record. The Client and/or Protector could be the sole Beneficiary.
Purposes
The most common purposes for private interest foundation are as follows:
Privacy. Private Foundation may be created purely for privacy. The terms of a will are public and the terms of a PIFs are not.
Spendthrift Protection. Panama Private Interest Foundations may be used to protect one's self against one's own inability to handle money. It is not unusual for an individual to create an inter vivos trust with a corporate trustee who may then disburse funds only for causes articulated in the trust document. These are especially attractive for spendthrifts.
Wills and Estate Planning. PIFs are frequently used in wills (indeed, technically, the administration of every deceased's estate is a form of trust or Private Interest Foundation in this cases). A fairly conventional will, even for a comparatively poor person, often leaves assets to the deceased's spouse (if any), and then to the children equally. If the children are under 18, or under some other age mentioned in the will (21 and 25 are common). The executor of the will is (usually) the protector, and the children are the beneficiaries. The protector will have powers to assist the beneficiaries during their minority.
Corporate Structures. Complex business arrangements, most often in the finance and insurance sectors, sometimes use Private Interest Foundations among various other entities in their structure, usually these entities are holding entities.
Asset Protection. The principle of "asset protection" is for a person to independence the assets from his or her own assets, with the intention that future creditors will not be able to attack that money, even though they may be able to bankrupt him or her personally. One method of asset protection is the creation of a discretionary trust, of which the settlor may be the protector and a beneficiary, but not the trustee and not the sole beneficiary. In such an arrangement the settlor may be in a position to benefit from the trust assets, without owning them, and therefore without them being available to his creditors. Such a trust will usually preserve anonymity with a completely unconnected name (e.g. "The Teddy Bear Trust").
Tax Planning. The tax consequences of doing anything using a trust are usually different from the tax consequences of achieving the same effect by another route (if, indeed, it would be possible to do so). In many cases the tax consequences of using the trust are better than the alternative, and trusts are therefore frequently used for tax avoidance.
Tax Evasion. In contrast to tax avoidance, tax evasion is the illegal concealment of income from the tax authorities. Trusts have proved a useful vehicle to the tax evader, as they tend to preserve anonymity, and they divorce the settlor and individual beneficiaries from ownership of the assets. This use is particularly common across borders — a trustee in one country is not necessarily bound to report income to the tax authorities of another. This issue has been addressed by various initiatives of the OECD.
Money Laundering. The same attributes of trusts which attract legitimate asset protectors also attract money launderers. Many of the techniques of asset protection, particularly layering, are techniques of money-laundering also, and innocent trustees such as bank trust companies can become involved in money-laundering in the belief that they are furthering a legitimate asset protection exercise, often without raising suspicion.
Co-ownership. Ownership of property by more than one person is facilitated by a trust. In particular, ownership of a matrimonial home is commonly effected by a trust with both partners as beneficiaries and one, or both, owning the legal title as trustee.
Private Interest Foundation
By Offshore Legal Support
Panama Private Foundations
The anonymous bearer share corporation is maybe the most common
service in the Panama offshore system, in itself, a Panama bearer share corporation is not the strongest asset protection strategy available. Any good asset protection plan includes several steps for privacy. A Panama corporation owned by a foundation is a great and strong combination; in such you will have the power of the Panama Private Interest Foundation with the Panama bearer share corporation.
The Panama Private Interest Foundation is sort of a combination of a will, a trust and a corporation best of all, in a sense. Panama Foundations are more versatile and can accomplish more than Trusts plus they are anonymous. It only takes 2-3 business days to form a Panama Foundation. Panama Corporations can be formed in the same 2- 3 days even if the Corporation is to be owned by the Foundation. No one owns a Panama private Interest Foundation, so you are not the owner of the Foundation, no one is according to the statutory laws of Panama.
A Panama Foundation can own the shares of a Panama Anonymous Bearer Share Corporation, thus removing the client from being any sort of owner of the Corporation. Now since the Corporation is owned by the Foundation and the client does not own either one, it creates a most beneficial scenario for some customers. Besides this, the client is not the founder of record of the Foundation (we can supply a founder), you appear in no public registry or database in regards to the Foundation and the Foundation can even be so created that the client is not even a beneficiary. However the client can just be the protector, which is a private position never appearing in any database or public registry. The client is not a beneficiary of the Foundation which could be seen by some governments in a similar way to the beneficiary of a trust, not an owner of the Foundation and not really a true person of control, just a protector who protects things to make sure the wishes of the foundation are fulfilled.
Foundation protectors do not initiate transactions just oversee them to make sure they are consistent with the wishes of the Foundation thus they are not persons with true control over the Foundation, they just have veto power. Read below to learn more and questions are always welcome. This is serious material that needs to be studied before one can truly appreciate all the thought that went into the legislation creating the Panama Private Interest Foundation with all its subtle and not so subtle advantages that make this the most outstanding asset protection tool in the world today.
Advantages of Panama Foundations:
• Protects assets (real estate, bank accounts, stocks, bonds, art and collectibles, corporations, etc.) from financial enemies and potential financial enemies. A Panama Foundation can own one or more Panama Corporations. This means you can operate an anonymous Panama Corporation which is not owned by you, it is owned by the Foundation. Foundations have no owners. A Panama Private Interest Foundation is a court tested method to keep assets immune from the personal debts of the person starting the Foundation. It prevents forced heir ship. The
Panama statues relating to Foundations are based on the
Lichtenstein model – "Stiftung".
• According to the laws in Panama, the assets of a Panama Private Interest Foundation are not considered to be subject to sequestration or embargos. This means that the assets cannot be frozen as a protective measure before a full trial is gone through. The meaning of sequester is as follows from the legal dictionary: a legal writ authorizing a sheriff or commissioner to take into custody the property of a defendant who is in contempt until the orders of a court are complied with, or a deposit whereby a neutral depositary agrees to hold property in litigation and to restore it to the party to whom it is adjudicated to belong to. The exception to this rule would be if the Foundation itself (not the founder, not the protector, not the council members, not the beneficiaries) did something illegal like for example it illegally broke a lease on a real estate transaction and refused to pay the rent owed, then the Foundation assets could be frozen to the extent of the amount owed under the contract if a judge so ordered and a bond was posted. If the Foundation itself does not directly commit the illegal action then the assets of the Foundation are not subject to freezing or seizure. This gives great peace of mind when funding their foundation and we suggest to our clients that the Foundation never does anything that could lead to any litigation, think of it as a holding entity.
• The foundation can have instructions to dispose of assets in a certain way in the event of you encountering serious legal or other difficulties like being sued, being forced into bankruptcy, being kidnapped and held for ransom, being blackmailed or the victim of extortion, or if in any way you are incapacitated or your ability to function freely is inhibited in whole or in part, etc. There can be secret instructions for a specific person to deal with assets in such an event as the founder sees fit. These secret instructions can appoint a temporary protector in the event you are under such duress with specific instructions as to how he should proceed with the foundation and its assets. This would remove the ability for you to move the foundation assets around, period. This is now something you can not do until you can demonstrate to the person inserted as the temporary protector that the conditions acting as the trigger for the empowerment of the new protector are no longer in place or no longer operative and you are no longer under duress and then as per your instructions you will be the Protector again with all the power returned to you.
• Panama Foundations have no owner thus there is no registry in existence that records Foundation ownership in Panama. The Foundation can be a shareholder or owner of a corporation. Thus your Foundation could be the owner of an anonymous Panama bearer share corporation, which you use to conduct business. Then you could say you are not the owner of the corporation. Since a Panama Foundation really has no owner you would be telling the truth and in the unlikely event the Foundation came up you could also say you do not own that as well.
• Foundations can be used to provide for the financial well being of family members according to your explicit instructions. Once could say my foundation income will go to my surviving spouse but in the event the spouse remarries then the foundation proceeds will go to my eldest child. This would be enforceable in Panama. The Foundation can protect closely held businesses, providing for continuity into second and third generations by preventing property-splitting; to protect and provide for minors or disabled persons or those incapable of managing their own assets; to manage payments of income or distribution of assets to family members or to provide for their education, housing, or maintenance.
• The Foundation can manage profit sharing or pension plans for employees, to hold shares, participate in or have an interest in private or public companies; it is a vehicle for the collection of royalties. It can engage in commercial transactions where the proceeds of such are dedicated exclusively to the non- commercial purpose or objectives of the Foundation. Very useful point.
• You could have a formal written agreement appointing you as the investment manager or business manager for the Foundation. This agreement would be signed by the Nominee Council members and would be notarized and apostilled if needed. The agreement could spell out your compensation including benefits like use of foundation auto, travel expenses, general expense account, use of foundation apartment or house, use of foundation boat, medical benefits to be paid directly by the foundation to the health care provider or doctor including elective surgery like plastic surgery, paid legal expenses direct from foundation to law firm, etc.
• According to Panama law, the assets of a Panama Private Interest Foundation are considered to be "non-embargable", and "non-sequesterable", which means that the assets cannot be frozen under any circumstances.
• The Panama Foundation needs no business license.
• The annual tax for the Foundation is fixed at $300, which is included in total subsequent year fees of $695 starting in year two.
• The Foundation can serve as a last will and testament.
• The Foundation can effectively guard against disputes amongst heirs.
• The Foundation can carry on scientific, philanthropic, religious, humanitarian or educational purposes.
• The Foundation can have bank accounts.
• The Foundation income is tax-free under Panama law.
• Royalties, copyrights, trademarks can be assigned to the
Foundation.
• You can assign assets to a Panama Foundation in return for an annuity.
• The Foundation can be an investment vehicle for real estate, stocks and bonds. It can hold bank accounts, boats, planes, artwork, collectibles or other assets with highly specific instructions as to how such assets should be dealt with under varying circumstances, all custom designed to meet your specific needs.
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