Legal Services
Here at GSL we have our own in-house lawyer specialising in the set up of Corporations, Foundations and the handling of all types of Real Estate transactions. Generally, Corporations are used for profit ventures involving business activity such as securities trading, banking, international trade, ownership of assets etc.. Most of our clients establish Corporations for the purpose of holding an asset such as an apartment, house or land that they purchase. Foundations are generally used for non-profit activities such as charities, receiving or giving donations, grants, etc., but can also be used for holding purposes such as holding ownership of corporations or any other type of asset. Several of our clients use Foundations to hold ownership of their Corporations for additional confidentiality and asset protection. Click on the links to see the application form for a Corporation or Foundation, which can then be printed and sent to us by courier. We are able to accept payment by Wire transfer, US$ Check or Credit Card. For more information on any of the following please click the link below:
Panama Corporations
Private Interest Foundations
Real Estate Process
Here at GSL we have our own in-house lawyer with 10 years of experience in all aspects of Panamanian Law. We are able set up a Panamanian Corporation within 7 working days, which will include the following.
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Original Articles of Incorporation (in Spanish),
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English Translation of Articles of Incorporation,
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Resident Agent, Registered Office,
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Nominee Directors if required,
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Pre-signed, undated Nominee Director resignation letters,
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Share certificates issued to "The Bearer", or to any person or entity that you designate,
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First Minutes of the Board (whereby the subscribers renounce their right any shares),
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Government Registration Fees paid for the first year,
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Annual taxes paid for the first year of $250.00,
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Shareholders book duly notarized.
The cost for the complete Corporation as listed above is $1,000.00. This can be paid by credit card, US$ check or wire transfer. If you wish to pay by credit card we will send you a form to complete and fax back to us. Click here to fill in the details required for the application form. Once the Corporation is complete it can be forwarded to you anywhere in the world by courier service, or held securely in our office pending your return. There is an additional charge of $50.00 for sending these documents to you.
General Power of Attorney - We will provide a General Power of Attorney whenever you require one, detailing the name of any person you wish. The person whose name appears in the Power of Attorney can then actually operate the corporation, sign contracts, open and operate bank or brokerage accounts etc.
General Information Regarding
Panama offers the most favorable and most flexible incorporation laws available in the world.
Panama Corporations can be used for international trade, to settle trusts or foundations, to establish and own bank or brokerage accounts, or hold ownership of real estate or any other type of asset. In some cases,
Panama offers the strictest corporate book and banking secrecy laws available in the world, therefore providing legal protection to your assets and your identity through the confidentiality of corporate business and banking transactions.
Panama Private Interest Foundations
Here at GSL we have our own in-house lawyer with 10 years of experience in all aspects of Panamanian Law. We are able set up a PIF here in
a. Original Foundation Charter in Spanish,
b. English Translation of Foundation Charter,
c. Resident Agent,
d. Registered Office,
e. Optional nominee council (directors),
f . Pre-signed, undated nominee council resignation letters (notarized),
g. Private Protectorate Document (notarized),
h. Example Letter of Wishes,
i. Government Registration Fees.
The cost for the complete Foundation as listed above is $1,200.00. This can be paid by credit card, US$ check or wire transfer. If you wish to pay by credit card we will send you a form to complete and fax back to us. Click here to fill in the details required for the application form. Once the Foundation is complete it can be forwarded to you anywhere in the world by courier service, or held securely in our office pending your future return. There is an additional charge of $50.00 for sending these documents to you.
General Information Regarding
History of
The Panama Private Interest Foundation is a type of entity that is a cross-breed between a Trust and a Corporation, however, it is neither. A Foundation is an entity that is different from any other legal entity known in Anglo-Saxon law because it is not the legal personification of a person or group of persons (as with a corporation), rather it is a legal entity that does not have owners (share-holders, participants, or partners), and it traditionally has a specific purpose for the benefit of a general group of individuals.
The concept of a "Private Interest Foundation" began when the Principality of Liechtenstein created the "Law of Persons & Companies", the 20th of January, 1926 (Personen und Gesellschaft Recht - P.G.R.), which 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).
Historically, wealthy families in
The Panama Private Interest Foundation is a legal entity that was developed based on the Private Interest Foundation models from three different jurisdictions including the Principality of Liechtenstein,
The Panama Private Interest Foundation offers clear advantages for international estate planning, providing the ultimate in privacy, anonymity, and protection to the Protectors, Founders, and Beneficiaries of the Foundation. The Panama Foundation is a solution to a global need for an affordable, anonymous, flexible, private, estate planning vehicle that can be used to hold assets such as corporations, trusts, bank accounts, investment accounts, real estate, or any other type of asset.
A Panama Private Interest Foundation comes into existence upon its registration in the Public Registry. No approval from any public authority is required. Law No. 25 of June 12, 1995 regulates Panama Private Interest Foundations.
Uses of
Panama Private Interest Foundations may be established 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, however, they do not wish to own their corporations themselves directly, due to the Controlled Foreign Corporation (CFC) rules in their home countries. Several highly taxed countries such as the
Instead of holding the corporations' shares in their personal name or in bearer form, they establish a Private Interest Foundation in
Another advantage of utilizing the Foundation as a shareholder applies in the following scenario: In many cases, when opening corporate bank accounts or investment accounts, the financial institutions require that you reveal the beneficial owners of the corporation. Through the Foundation ownership strategy, one can state that the 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.
The Panama Foundation provides additional advantages other than just ownership. For example, the Panama Foundation can be useful in transferring funds offshore or receiving funds from offshore. In some cases, people use Panama Foundations as vehicles for these purposes. Some people donate their funds to their Panama Foundations and later use the Foundation to give educational or special grants to their children, grandchildren, or any one else they choose. The advantage in this case, is to avoid fiscal regulations surrounding donations, where some governments impose "gift taxes" and exhaustive reporting requirements.
In general, Private Interest Foundations may not engage in habitual profit-making commercial activities as a corporation can. Nevertheless, they may carry out commercial activities from time to time, as long as the profits of those activities are used for the objectives of the foundation. For example, a Private Interest Foundation may engage in banking or investment activities, 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 Foundation.
Elements of a Panama Private Interest Foundation
The Foundation has a Founder, a Council, a Protector, and Beneficiaries. Below we have explained what role each of them plays in the Foundation:
Founder: The Founder is the person or entity that establishes the Foundation in the Public Registry of Panama. Our lawyer is generally the Founder of each Foundation that we establish, since it is our lawyer who goes to the public registry to incorporate the Foundation. The Founder has no influence over the control of the Foundation, and is only recognized as the individual who presented the Foundation articles in the public registry when the entity was originally registered.
Council: The Foundation's Council serves the same purpose as the board of directors on a corporation. The council members are each registered in the public registry with their names, addresses, and identifications as council members to the Foundation. Our firm generally appoints a "Nominee Foundation Council" to fill the council positions, so to provide additional privacy and confidentiality for our clients. When we appoint a nominee council, we provide our client with pre-signed, undated letters of resignation from each nominee council member so that our client can replace the council at any time. The nominee council has no control over the Foundation or any of its' assets, they are only there to fill in the blanks in the public registry.
Protector: The Protector is the person or entity who ultimately Controls the Foundation and all assets held within it. The Protector is appointed by the Foundation Council when the Foundation is created, however, once the Protector is empowered, the Protector can then remove the council members at any time without consent of any one else. The Protector can be appointed privately, through a Private Protectorate Document, signed by the Foundation Council. Hence, the Protector can maintain this position free of public knowledge.
We generally appoint our client as Protector of the Foundation, through a notarized Private Protectorate Document so that our client maintains complete control over the Foundation, in a private and anonymous manner. Once the Protector is appointed, it can always be changed per the Protectors wishes. However, a Protector is not required and if you prefer, you can choose not to use a Protector, or to use a nominee Protector.
Beneficiaries: Unlike a corporation that issues share certificates to certify who the owners are, the Panama Private Interest Foundation does not have owners, rather it has Beneficiaries. The Foundations Beneficiaries are appointed by the Protector through either a simple, privately written Letter of Wishes, or through a more formal set of Foundation By-Laws (Foundation By-Laws should be written with the assistance of a Panamanian Attorney). Either way, the privacy and confidentiality of beneficiaries can be protected through their appointment in the Letter of Wishes, or By-Laws of the Foundation, since the contents of the Letter of Wishes or By-Laws may remain private and need only be known to interested parties. Also, a Panama Foundation may be set up so that the Protector is the sole beneficiary until his or her death, at which time the foundation continues for the benefit of other beneficiaries.
Letter of 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. The Letter of Wishes should also state whether the Foundation should continue existing, and have a new Protector appointed, or if the Foundation should be dissolved upon the death of the Protector. There is no specific format that the Letter of Wishes must be written, and it can be written or changed at any time after the Foundation is incorporated, per the Protectors wishes. The Letter of Wishes can be held privately, or can be registered publicly. Generally, most people prefer to maintain the Letter of Wishes privately, so that the Beneficiaries and Protector remain anonymous and private.
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. The Foundations By-Laws essentially handle the same function as a Letter of Wishes since the By-Laws should specify exactly how the Foundations assets should be handled or distributed upon a triggering event such as the death or incapacity of the Protector. The By-Laws should also state whether the Foundation should continue existing, and have a new Protector appointed, or if the Foundation should be dissolved upon the specified triggering event(s). There is a specific format that the By-Laws must be written, yet the contents of the By-Laws can be changed at any time after the Foundation is incorporated, per the Protectors wishes. The By-Laws can be held privately, or can be registered publicly. Generally, most people prefer to maintain the By-Laws privately, so that the Beneficiaries and Protector remain anonymous and private
C. Panama Foundation Tax Information
· No tax reporting requirements.
· No Income Tax.
· No Capital Gains tax.
· No interest Income Tax.
Titled Property
Titled property is very similar to that of "fee-simple" titles in the
1. Promise to Purchase Contract: Generally a small down payment is made at the signing of the promise to purchase contract. The purpose of this is to secure the property and provide enough time for the title search, as well as to coordinate payment arrangements for the closing and the setup of a corporate property holding structure (if applicable). This contract should normally be registered at the Public Registry to guarantee that the property cannot be sold to any third parties in the interim prior to the final closing.
2. Always use a competent lawyer to do a title investigation and due diligence consisting of;
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Verification at the Public Registry that the title is in fact in the name of the seller, and it is free and clear of encumbrances, liens, or other issues that could affect the free disposition or transfer of the title;
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The cadastral survey map should be reviewed, and in some cases it is recommended to have a professional surveyor physically verify the maps points on the property, to avoid future boundary conflicts;
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Verification of utility debts to include water and sewage, power, telephone, etc.
3. Buy-Sell Contract: This contract is registered at the Public Registry and the final balance is paid to the seller, or in some cases, if an escrow agent is used, payment is made once the title is transferred to the buyers' name. Often a Letter of Credit is issued by the bank on behalf of the buyer if they have arranged a mortgage on the property. This is automatically cashed when the title transfer has taken place.
4. Title Transfer: The property ownership is officially transferred to the buyer once the property title is transferred to buyers' name, which is done immediately after the buy-sell contract is signed by each party and registered at the Public Registry. In some cases, if the title is in a corporations' name, and the seller agrees to sell the corporations' shares, then there is no transfer of title, only a transfer of shares of the corporation.
Possession Rights Property
Possession Rights Property is similar to "squatters rights" as was common in
1. Promise to Purchase Contract: Generally a small down payment is made at the signing of the promise to purchase contract, and its' purpose is to secure the property and provide enough time for the due diligence, as well as to coordinate payment arrangements for the closing. Contracts relating with the purchase of rights of possession cannot be registered at the Public Registry, therefore, they should simply be authenticated by a Public Notary.
2. Due Diligence: Unlike titled property that is easily verifiable through the Public Registry, the due diligence procedures on possession rights property is more complex since there is no central database of information on possession rights properties. Therefore, buyers of possession rights should take extra precaution during the due diligence process. Generally, the extent of the due diligence investigation that one can realize on possession right property is the following;
- Verification of Certification of Rights of Possession: The certification of possession rights should be validly issued from a competent government authority, and should contain the possessors' name, correct description of the property in terms of location, size (area), limits, boundaries and neighbors (to the north, south, east, and west).
- Verification of Survey: The survey should be stamped and signed by a professional licensed surveyor engineer, identifying the possessors' name, location and reflecting the same information in accordance with the certification of possession rights.
- Inspection: The main elements to verify are physical occupation, no opposition by third persons, and good faith. A physical inspection should be realized by your surveyor to identify and mark the points of the property as well as confirm these points with the neighbors to ensure that there are no future boundary conflicts. Also, the property should be maintained and fenced to clearly delineate the boundaries.
- Permitting Verification: In some cases, if the buyers' intentions are to build a certain type of structure or project on the possession rights property (for example, a marina, port, hotel, airstrip, etc.), it is necessary to verify if there are any national or municipal regulations that may prohibit those activities in the area.
3. Buy-Sell Contract: The final balance is paid at the signing of the final buy-sell contract, or in some cases, if an escrow agent is used, once the possession right certification is actually transferred or changed to the buyers' name. Contracts relating with the purchase of rights of possession cannot be registered at the Public Registry, therefore, they should simply be authenticated by a Public Notary.
4. Possession Rights Certification Transfer: The possession right over the property is officially transferred to the buyer once the possession right certification is transferred to buyers' name, which is done immediately after the buy-sell contract is signed by each party. In some cases, if the possession rights are in a corporations' name, and the seller agrees to sell the corporations' shares, then there is no transfer of possession rights certification, only a transfer of shares of the corporation.
Concession Property
Concession property is similar to that of a land lease arrangement, as is common in