Investment Fund in Panama

INVESTMENT FUND IN PANAMA

Panama is the most attractive state with ample opportunities for investment and distribution of financial investments. The local financial and tax laws of Panama are well adapted to external investors. For all foreigners who wish to invest their financial capital, the country offers the most attractive conditions and instruments to protect confidential rights. It is for this reason that Panama often attracts businessmen who strive for the maximum security for their savings abroad. And the most important thing with the task of asset preservation is the mechanism of foundation creation.

The Investment Fund is an agreement between the participants on the transfer of ownership of property to persons who arrange it. The main principle of the foundation’s work is the separation of assets from previous owners and their protection against encroachments of founders.

Among the peculiarities of investment fund formation in Panama the following may be highlighted:

  • status of legal entity;
  • creation of certain tasks, which are formulated in the declaration (key document of the structure);
  • absence of the owner’s name and identification of founders, managers and beneficiaries;
  • the ability of one person to simultaneously act as the creator and beneficiary of the Fund;
  • absence of shareholders and shares;
  • the ability to participate in commercial activities to achieve the goals set forth in the Declaration;
  • peceipt of passive profit, royalties, interest and dividends;
  • ownership of different company assets and the ability to establish other companies.

ADVANTAGES OF PANAMIAN INVESTMENT FUNDS

In the conduct of financial transactions banking structures are based on the legislation of the country. Its main provisions were formulated as early as 1995. They are designed in such a way that all foreign assets are reach for external claims after a three-year stay in the structure of the Fund. Before the transfer of assets to the fund, applicants can challenge their property rights in court, and after this period any lawsuits will be immediately rejected.

Foundations in Panama have other advantages:

  • unlimited opportunities for tax optimization and planning (all external income is not taxed);
  • small annual contributions to the country’s budget;
  • absence of currency control, annual audit, formation of reporting and record keeping;
  • creation and storage of the Fund only the documentation requested by the founders, managers or protectors;
  • complete freedom of action regardless of the opinion of the meeting;
  • non-interference of the state in the activities of the investment Fund;
  • maintenance of documents in any language;
  • signing of agreements without the seal of the Fund.

Besides these advantages there are others. Among them there is a high degree of security of information about owners of assets. For the public the state develops only the register with the Charter of the Fund structure. It includes the names of the founders and members of the Governing board. All other confidential points, such as the profit of a particular fund and its distribution, shall not be disclosed, as they are only contained in private documents. The secret papers also refer to the protectors and protectors of the investment Fund data. These persons have access to the most closed information. For its disclosure in Panama, there is the fine of $50 000 US dollars or imprisonment.

PECULIARITIES OF CREATION AND PURPOSES OF PANAMANIAN INVESTMENT FUNDS

Creating an investment fund in Panama is the most profitable if there is a threat to preserve the asset integrity. Some funds establish for other purposes. Among the most common can be noted the following:

1) Striving to ensure complete confidentiality of ownership of assets or companies. Usually the owner prefers not to disclose his name and appoints nominee founders. It closes any information about the beneficiaries, and all attempts to request data through the judicial authority are rejected.
2) protection of property against claims of creditors, authorities or state. Investment funds cannot be arrested or withdrawn after their expiry date.
3) Distribution of inheritance at the request of the founder. Such a feature of the fund helps to reject any claims for a mandatory share of potential heirs. The property is received only by those persons who have been specified in the documents by the founder of the Investment Fund.
4) profitable investment and accumulation of funds. The structure of the fund management can carry out the necessary financial operations very thoughtfully and competently. The founder may not doubt the profitability of transactions and the safety of important confidential documentation.

MECHANISM FOR CREATION OF THE INVESTMENT FUND

At the initial stage the founder should form the starting capital. Under the Panamanian law, the minimum amount of the statutory fee is $10 000 US dollars. However, it can be deposited in any currency and in tranches. The remaining assets in the constituent documentation do not appear as long as they are not. In addition, the founder has the right to transfer them to the investment fund at any time.

The next step of foundation creation is the choice of the name. Here the founder should only study the register of funds and choose the original name, different from the others. It should not include offensive or immoral words. The name of the fund is fixed in Latin language with the prefix Fundation.

The third step is the choice of location (office) and agent in the person of legal counsel or law firm.

Then the founder registers his investment fund with the register, pays the fixed fee ($350 US dollars) and gives a package of documents (protocol, list of members of the Board of the Fund and power of attorney).

The last step of the foundation is to get a ready package of permits. It includes a statement of confirmation and certified forms of documents. When issuing securities, the authorities immediately warn the founder that it is necessary to pay the state fee in the amount of 400 US dollars annually. In case of late payment, the fund may be fined for a more tangible amount or excluded from the register.

Organizational structure of the Fund

The investment funds in Panama have a traditional structure. It presents creators and information from open access. In this case, the founders can be specified both private and legal persons with different foreign citizenship.

In addition, the Panama Foundation may have only one founder, who can be both a member of the Council and a beneficiary. But, along with it, the management structure of the investment fund should include:

  • Council with management functions. Usually it consists of three natural or legal persons with any residency.
  • Confidential protector-trustee. Such a person can be any person who will supervise the work of the directorate and have the right of veto. Most often the protector is the founder himself.
  • Beneficiaries who do not have rights to participate in the investment fund, but who receive profit from it. Their number and composition can be immediately appointed by the founder or changed in the course of the foundation.
  • A resident agent of the Panama State that has a reliable confidential communication between the authorities and the Fund. This person must clearly follow the owner’s instructions and prevent any conflict situations.

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