Private Interest Foundation

The private interest foundation is a juridical person; which is equipped by its Founder with determinate assets which constitute a separate patrimony of the foundation, after their transference. These properties are managed by a Foundation Council, which is named by the Founder with the purpose to accomplish the objectives of the foundation.

The Panama Private Interest Foundation is a legal entity, quite modern and flexible, that was developed based on the traditional European foundations.

The private interest foundations area instruments for the planning of family successions, may act as shareholders of assets and help to preserve the patrimony for beneficiary’s generations.

Law No. 25 of June 12, 1995 regulates Panama Private Interest Foundations.

Advance of the Panamanian Private Foundations

• Personal information will kept confidential
• The may be established to have effects from the date of their constitution or after the death of the Founder.
• No tax reporting requirements.
• No income tax.
• No capital gains tax.
• No interest income tax.
• No sales tax.
• No tax to beneficiaries.
• No beneficiary transfer tax.
• No annual reports or financial statements to file with Panamanian government

Elements of a Panama Private interest Foundation

1. Founder: The role of the founder should be established the foundation formally in the Public Registry. The founder has no influence over the control of the foundation or its assets.

2. Council: Consist of three natural persons, or juridical person. The council’s responsibilities include managing the assets of the foundation in accordance with the foundation charter or its regulations. The name and addresses of the members of the council are registered in the Public Registry.

3. Protector: The protector is the person or entity that ultimately controls the foundation and all assets held within it. The protector can be designated in the foundational charter, which will be of public record, or by a private document, which ensures privacy and anonymity.

4. Beneficiaries: The beneficiaries are those people (or that group of people) who are meant to benefit from the foundation. The protector will need to write a Letter or wishes, indicating whom the beneficiaries of the foundation are.

5. Letter wishes: The Letter of Wishes is a simple letter, written by the Protector, which specifies exactly how the Foundations assets should be handled or distributed upon a triggering event such as the death or incapacity of the Protector.

6. Foundation by laws. The Foundation does not need to have By-Laws, since a Letter of Wishes is legally sufficient for expressing the Protectors' requested testamentary instructions However, if one wishes to have a more formal Foundation testamentary document, written and signed by a Panamanian Attorney, and notarized by a Panamanian notary, then one can request the assistance of a Panamanian attorney to draft the Foundations By-Laws.

Procedures for Establishing a Panama Foundation

1. DETAILED PERSONAL INFORMATION: Please complete the Order Form with the required personal information

2. THE NAME OF THE FOUNDATION: The name of the foundation in any languages with characters of the Latin alphabet, and which to avoid confusion, shall not be identical or similar to that of any other foundation previously registered in the Republic of Panama. The name shall include the word “foundation” to distinguish it from a natural person or from different kind of juridical person. For Example: Fundación de Benancio Herrera, Atlantic wildlife refugee Foundation.

3. FOUNDATION COUNCIL (DIRECTORS): On the online application, you should indicate whom you want to appoint as council members (directors) of your foundation. The council members can be either individuals or entities. If the council members are individual, the panama foundation requires 3 council members (President, Secretary and Treasurer). If the council member is an entity, the law only requires one council member. For the purpose of anonymity, you can opt for Nominee Council Members, which we will provide.

4. BENEFICIARIES: The beneficiaries of the foundation need not to be known by us when registering the foundation. When your receive the foundation documents, your will appoint the protector, by signing the Private Protectorate Document. The protector will need to write a Letter or wishes, indicating whom the beneficiaries of the foundation are.

5. PASSPORT: Photocopy of the entire passport (all pages to comply with the requirements by the Law that demands to know the migratory movement of the client) duly authenticated by a Notary Public as true copy of the original document and that the photograph is a reasonable likeness, and apostilled if applicable

6. PROOF OF DOMICILE: Original of a credit card statement showing their full name and address; or original of a bank account statement showing their full name and address; or an original of a monthly statement of account issued for any public utility services supplied to the client showing their full name and address (electricity, water, telephone, cable TV or Internet).

7. BANK REFERENCE LETTER: At least one (1) bank reference letters by reputable banking institutions stating the date they became a client of the respective banks,), duly authenticated by a Notary Public and where applicable;

8. ANOTHER LETTER OF REFERENCE: It may be a professional reference, in original, from a lawyer, accountant or financial consultant, or a business reference (any business) stating since what date they know the client personally), duly authenticated by a Notary Public and apostilled where applicable;

9. ADDITIONAL DOCUMENTS: On a case-by-case basis and depending on the amount of the volume of the funds, profile or activities of the companies, the company will have the right to request additional information or explanation.

10. PAYMENT OPTIONS:

    1. Wire Transfer: By choosing this payment option, you will need to add    US$15.00 for Wire Transfer Fee. We highly recommend this method of payment, for fastest delivery and minimum transfer fee. (We will e-mail you the detailed instructions).
11. TIME: Your foundation can be established within 3 to 5 business days.