Panama Private Interest Foundations (PIF) and Panama Trusts
Panama Private Interest Foundations (PIF) and Panama Trusts, are two different legal figures, we will mention some of their main difference below:
This article is prepared to answer the question: What are the differences between the Panama Private Interest Foundations (PIF) and Panama Trusts.? For additional information, contact our experts at Delvalle & Delvalle for a free consultation.
1. Panama Trusts are regulated by Law 17 of February 20, 1941, while Panama Private Interest Foundations (PIF) are regulated by Law No. 25 of June 12, 1995.
2. A Trust can be defined as the legal act by virtue of which a person called the settlor transfers assets to another called trustee to manage or dispose them, in favor of a trustee or beneficiary, who can be the same settlor, while A Private Interest Foundation is defined as the legal act by which a natural or legal person (founder), transfers or assigns assets of his property in favor of said entity ( the foundation) , to be administered by a foundation council, in favor of a beneficiary (who may be the founder himself).
3. The main difference between these 2 legal figures, would be that in Panama the trustee of a trust, must have a license as such to exercise this activity, while in the foundation the foundation council, that in theory is the one that manages the foundation, do not require any type of license, even the founder/client himself can be appointed on the board.
4. While both figures offer protection and transferring of the assets, in the Panama Private Interest Foundation (PIF) the client can maintain control of the assets, while in the Panama Trust when transferring the assets to a third party, the settlor must follow what is stipulated in the document of constitution of the trust.
5. In the Panama Private Interest Foundations (PIF), if the client is in need, it has the option of appointing nominee founder and nominee members of the founding council, to preserve its confidentiality. It is advised that the client or a person of trust, acts as protector of the foundation (which is appointed in a private document) so this person can expressly supervise the actions and decisions of the founding council.
For additional information on Panama Private Interest Foundations (PIF) and Panama Trusts, contact us.