Service Areas | Panama Private Interest Foundations

The main objective of Private Interest Foundations is to provide a legal vehicle that will allow you to protect, to ease the administration of and to avoid hereditary processes of your personal estate.

Private Interest Foundations combine the advantages of corporations and trusts into one legal institution.  Through a Private Interest Foundation you may segregate all or part of your patrimony in a confidential, secure and simple form.  Private Interest Foundations work with two kind of documents, one (the Foundation Charter) which is public and serves to create the legal entity and the other (the Regulation) which is private and confidential and details the conveyed assets and your specifications about the beneficiaries.  Like a trust, you entrust the property title, administration and disposition powers but instead to a third party (trustee) to the Foundation itself.  The Private Interests Foundations act through a foundation council which is bound to follow the instructions given by the founder in the Foundation Charter and its Regulations and always for the benefit of those previously determined therein.  The foundation council works like the board of directors of a company, however, as opposed to a corporation or international business company, the Private Interest Foundation cannot engage, on a regular basis, into commercial activities. 

Advantages and uses of Panama Private Interest Foundations

• It is a non profit organization that may engage however, in commercial activities in a non habitual manner, for example: holding properties, opening bank or investment accounts, holding stocks issued by other corporations provided that the income perceived from these stocks will be devoted exclusively for the purposes of the Foundation.

• It can be constituted to function throughout the founder’s life; or after his/her death; as can be determined by the Founder in the Foundation Charter.

• Are not subject to tax by reason of income earned from foreign sources. 

• Once transferred to the Foundation, the assets may not be affected by personal liabilities of the Founder or of the beneficiaries.

• The Foundation Council may be composed of one juridical person (i.e. a company or a professional trustee) or at least three individuals one of whom may be the founder.

• After the demise of the Founder the foundation council will proceed to transfer the assets and/or its proceeds to the appointed beneficiaries without the need of any judicial, administrative or other kind of processes and according to the instructions given by the Founder. 

• A Panamanian Foundation may migrate from or to other jurisdictions which accept it.

	Related Documents for Download: - Panama Private Interest Foundations (PDF - 144Kb)		For further information: - Juan A. Tejada Mora - Michelle O. de de la Guardia - Luis A. Chalhoub For assistance in David Office: - Karen R. Diez S.
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