How the world’s wealthiest people protect their riches – Part 2

Panama's banks hold over $55 Billion in total assets –twice that of Panama’s GDP in 2006.

One reason why Panama’s banks have so much money is the country's unique laws allowing the strongest asset protection in the world, in addition to the strict bank secrecy and anonymous legal entity laws.

In the last issue I detailed some of the rationale and structure of a Panamanian private interest foundation. In the second part of this article we will examine the purposes and functions of the foundation.

FOUNDATION PURPOSES: There are four purposes for a Foundation.

1. Holding Entity for the Corporation:  A Foundation itself has no corporate shares.  The Foundation can be the sole shareholder of your corporation.  You control the Foundation anonymously through a Private Protectorate role.  Since the Protector and the Beneficiaries are both appointed through non-public (private) documents, they remain 100% anonymous.

2. Anonymous Ownership of Bank Accounts: Most offshore tax haven banks around the world require knowing the true owner of an account. Panama maintains true bank secrecy laws requiring strict condidentiality by every bank employee. A Panama Foundation can open a bank account using its nominee council members keeping the true owners anonymous. The only exceptions occur when the foundation is accused of participating in either terrorism, money laundering, or depositing drug related proceeds. Only then can a Panama judge sign a court order requiring a bank to disclose an account's records.

3. Distribution of Your Assets to Your Heirs:  Under Panamanian laws, no one may freeze a Foundation’s assets under any circumstances. Providing the ultimate asset protection vehicle.

The only exception is if the Foundation is a defendant in a lawsuit or a co-conspirator in a crime.

The Panama Private Interest Foundation protects and distributes your assets to your beneficiaries upon a triggering event, such as your death or incapacity. Your Foundation’s Letter of Wishes (written by the Protector) details the Foundations assets, list of beneficiaries, and how and when those assets are distributed to the beneficiaries.  Since the inheritance comes from outside of the beneficiary's domestic country, the inherited assets are not subject to any of the standard taxes and legal procedures. Through the Foundation, your heirs will receive their inheritance free of probate, gift taxes, estate taxes, inheritance taxes, or legal delays.

4. Facilitates the Transfer of Funds Offshore and the return of those funds back onshore:  Since the Foundation is a non-profit entity, it may receive donations, and it may give donations/grants, etc. to anyone you choose. Hence, you can donate your funds to the Foundation.  In turn, the Foundation provides educational grants, charitable donations, etc. to anyone you choose. 

To Summarize: Foundations protect your assets, act as your holding company, provide total estate planning, and act as a charitable entity.

Rights of Heirs: Under Panamanian law, the founder’s heirs do not have a right to revoke the creation of the Foundation, or the right to object to the transfer of properties to the Foundation.  The laws of the founder’s country regarding intestacy have no bearing on the validity of the Foundation – ensuring honoring the Foundation’s objectives even upon the founder’s death. 

Features and Benefits

Some of the other features and benefits of a Foundation are as follows:

Limited Liability
A Foundation holds its own assets and liabilities separate from those of the founder or any other person. The founder and the Foundation are not responsible for the debts of one another, except where the founder has administered the Foundation in a way that ignores the separate identity of the Foundation. In such a case, a creditor of the founder might be able to invade the Foundation’s assets. In contrast, the Trustee of a Trust (often the grantor/creator) may have unlimited personal liability for the obligations of the Trust. Therefore, a Foundation provides better protection than a Trust.

See the next issue for Part 3.

Reader’s Letter

Caribbean or Atlantic

The Editor;
Dear Sir
Your sister magazine “Focus Panama”, in certain articles,, refers to the Atlantic and other times to the Caribbean. The map of your magazine correctly refers to the sea to the north of Panama as the Caribbean Sea. Could you explain this disorientation? I recommend consistency and in order to achieve this you should suppress the term Atlantic to avoid confusion.

Your magazine is interesting, apart for this situation. Congratulations.

Sincerely,
CTS

Editor’s Comments:
Thank you for your observation. The problem is that the use of “Atlantic” is almost universal in Panama. The residents of the former Canal Zone always made reference to “The Atlantic side”. The people in maritime circles and the canal utilize the term “the Atlantic entrance of the Canal”. Our convention center Atlapa was named after the Atlantic and the Pacific. The Panamanian Tourist Board never tires to say that a person in Panama can swim in the Atlantic in the morning and in the Pacific in the afternoon. Newspapers also make reference to the “Atlantic”. Focus Publications (Int.), S.A. has been a pioneer in the use of “Caribbean”, but sometimes we have lapses and go back to the old habit of using “Atlantic”.

Thank you for correcting us.

Martial arts flourish in Panama City

In a previous article, we visited many of the martial arts classes in the city and reviewed Aikido, Iaido, Karate, Kendo and Kenjutsu, covering most of the Japanese arts available.  You can find that article online at www.thevisitorpanama.com (Vol. 13 #11, May 18-31, 2007), or contact the writer. Now we will branch out to the rest of the options available.

By Kevin Reilly

Martial Arts is one of many options for good, physical exercise here in Panama City.  Some people think that to study martial arts simply means "fighting".  But, qualities like discipline, character develop-ment, and improved learning skills go hand-in-hand with the excellent physical conditioning inherent in the arts.  So, I'm happy to report, we've found even more places to practice martial arts here in the city.  Pick an art that sounds good for you and go check it out.  

Arroyo Sensei throws a senior Aikido student.

AIKIDO. We described this art in the previous article, but after much effort, I finally found the most senior Aikidoka and instructor in Panama.  Otilia Arroyo, Sensei, is a fine example of the dedication and depth of this art, for she has been practicing since 1981.  She has classes Tuesday and Thursday evenings, 6-8pm and Saturday from 9-12am at the Universidad de Panama Gym. (232-8090, 6698-2353)

HAPKIDO, a Korean martial art, is represented here in Panama by "Grand Master" Son Il Park, a 9th degree black belt born and trained in Korea.  He has two schools, one in Paitilla (264-5782) and Bethania (261-7440) for adults and kids as young as 3 years old !

In Miraflores there is the Panama Hapkido Academy where Rolando Vergara teaches children and adults Monday through Friday. (261-6141)

Or, in Plaza Marbella you can find Gary's Hapkido where the first class is free! (264-5796).

Grappling at the “507BJJ” Club.

JIU JITSU (sic)  If you are specifically interested in fighting, you can learn "Casquinha" Jiu Jitsu  from Panama's national champion in "Ultimate Fighting", Mr. Cristiano Machado.  It looks like a good workout, with the "ultimate" goal of simply dominating your opponent.  They call their place the "507BJJ Club" and it's located in Dorado Mall in El Dorado (391-4510, 6702-5234)  Unfortunately, other Jiujitsu schools here have failed to respond to my attempts to contact them.

JUDO (Japanese for "gentle way") was the first martial art to be included in The Olympic Games.  A derivative of the original "Ju Jutsu", it can be competitive, a self-defense system AND a very deep, philosophical art depending upon the instructor.  At the UP gym Braulio Ensenso, Sensei from Cuba has classes M, W, F at 4pm. (523-7202)

TAEKWONDO, another Korea art, has also been recognized as an Olympic sport and is well represented here in Panama.  With more than seven schools in the area, I'm afraid the best we can do in the space available here is to refer you to the Yellow Pages.  

TAI CHI & KUNG FU classes are available at the Chinese Martial Arts Center in Curundu. (232-7629)  "Shifu" Andrew Calvo, a 3rd degree black belt teaches here, the only Chinese place I could find !

With so many places to study Martial Arts in Panama,  I hope this article can help provide a little direction for any person interested in finding a place to train.  Even the uninitiated can usually tell if the place is "for them" or not.  Ask questions and beware of contracts.

Increase the potential of your company with training

To invest in Panama you need to know the local laws, especially those related to the Labor Code. When it comes to training and education you also need expert help. because to develop your enterprise you must find the necessary trained personnel who will help you to make the appropriate decisions regarding work regulations.. An adequate action will avoid costly lawsuits.

The company B.B. Capacitaciones Sin Límites, offers training seminars in areas related to enterprise development, with the aim of ensuring that your business has professionally trained personnel.

B.B. Capacitaciones gives seminars about: "Work Contracts", "Work Liquidations ", "Overtime", "Payroll and Benefits in Kind, "Labor Relationship and Social Security", "Wages Payment", "Law 51 and the Social Security Board", "Company´s Philosophy", "Company´s Image" and technical subjects such as "Air Conditioner Maintenance".

The seminars take place, generally, in hotels and they are presented by the best professionals, and specialists in their fields.

The mission of B.B. Capacitaciones sin Límites is to give entrepreneurs and investors the functional tools and practice, so they can operate in an efficient manner and that their personnel are properly trained to face the challenges of the world of business, and have the competition behind.

For more information call (507) 217-6610. (contributed)