The Private Interest Foundation

The main objective of a private interest foundation is to facilitate the administration of assets and patrimonial protection.

Through a Private Interest Foundation it is possible to protect your assets with complete confidentiality and security. The private interest foundation is formed through a founding act, this document is public and the essential requirements are established to form the private interest foundation, such as: the name, address and the founding purpose. There is another document that can be established privately at the discretion of the founder, I speak of the founding regulation in this the benefits, assets and their distribution among said beneficiaries are detailed.

Similar to a trust, powers of administration and disposition are entrusted to the private interest foundation.

The private interest foundation is governed by a founding council, which is obliged to follow the guidelines of its founder, guidelines established in the founding act or in the founding regulations.

The founding council acts as the board of directors of a company, in this case always seeking to fulfill the purpose for which the foundation was created.


Advantages of establishing a private interest foundation in Panama:

  • It is a legal body whose nature is not commercial, however, it can commit itself in an unusual way in commercial acts, as long as said acts are part of the object for which the foundation was created.

  • It can be established to function during the life of the founder or after his death, as established by the founder in the founding act.

  • A private interest foundation incorporated in Panama is exempt from any income tax derived from foreign sources.

  • The assets of the foundation are independent of the assets of the founder or of the beneficiaries respectively, for this reason the foundation is not obliged to respond with its assets for the personal obligations of its founder or beneficiaries.

  • Upon the death of its founder, the founding council must ensure that the assets entrusted to the foundation are transferred to their respective beneficiaries, without prior judicial process being necessary.

  • A Panamanian foundation can be transferred to another jurisdiction, as long as the new jurisdiction within its legal system accepts it.

I hope the information has helped clarify your doubts and if you had no doubts at least to know about the comparative advantages of establishing a private interest foundation in Panama. If you want we can talk, just send me a message by filling out the contact form you find in the menu or if you have already decided to coordinate a web meeting to talk about your new foundation of Panamanian private interest, I leave you the link below.

Panama City, Republic of Panama


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©2020 Jhonathan Santos Fieujean.  By God´s Hands