| Today many unscrupulous firms are offering | | | | point. I see many websites selling offshore |
| corporations and bank accounts in many | | | | corporations from dozens of countries. The |
| different jurisdictions with a shopping list | | | | only kind of corporation worth anything when |
| of countries available almost every one of | | | | it comes to privacy is a bearer share |
| them no longer any good, many being located | | | | corporation. By this what is meant is the |
| on Caribbean islands and are misleading the | | | | ownership of the corporation rests with the |
| customers into thinking they are real | | | | person who has the physical stock |
| offshore jurisdictions with privacy benefits. | | | | certificates of the corporation. Ownership |
| Wrong!!! | | | | need not be reported or recorded anywhere. A |
| | | | sale of the corporation does not need to be |
| Let's analyze some things to look for when | | | | reported. This is what is called a |
| shopping for an offshore jurisdiction. | | | | non-transparent corporation and is extremely |
| | | | disliked by many governments who think people |
| Bank Secrecy Without this we are not | | | | have no rights to privacy. In Panama a S.A. |
| interested. We want the bank to not be able | | | | Corporation or bearer share company has no |
| to divulge any information about the bank | | | | ownership reporting or recording |
| account including whether or not such a bank | | | | requirements. One merely hires professional |
| account even exists unless there is an order | | | | directors (which we provide) who appear as |
| from a competent court in the country where | | | | directors on hundreds of corporations and |
| the bank is located. More secrecy than this | | | | that is that. Directors are made public but |
| does not exist any place today. Numbered | | | | you need not be your own director, we provide |
| accounts are gone. Sparbuch accounts in | | | | professional nominee directors complete with |
| Austria are all gone, yes I know people offer | | | | resignation letters and general power of |
| them for sale on websites but they are all | | | | attorney letter. Corporation privacy is |
| long gone and closed down. The bank secrecy | | | | especially important since governments have |
| laws must be written into the law of the land | | | | taken to monitoring bank wire transfers |
| in question. Belize has no such bank secrecy | | | | including recently the Swift System scandal |
| laws written in their laws, people just seem | | | | showing the USA was monitoring Swift |
| to trust them even though there would be no | | | | Transfers and we do not know to what extent |
| legal penalty for them to reveal bank | | | | and for exactly how long but is best to |
| information if they see fit to do so. We want | | | | assume the worst. If one uses an anonymous |
| bank secrecy laws to call for prison and | | | | bearer share Panama Corporation there is lack |
| civil penalties for any violations in | | | | of transparency in that no one knows the |
| addition to allow for one to bring suit | | | | ownership behind the corporation, they only |
| against the bank for violations. Panama meets | | | | know the corporation received or sent a wire |
| this test. | | | | and the other side of the transaction. This |
| | | | serves to preserve your privacy to a large |
| MLAT Mutual Legal Assistance treaty. Many | | | | extent. Imagine how silly it is to use an |
| nations have entered into these agreements. | | | | offshore corporation where ownership is made |
| For a list of countries that have entered | | | | public and can be computerized thus one could |
| into these agreements with the USA courtesy | | | | tell in seconds who is the person behind the |
| of the US Government click here: | | | | corporation receiving or sending the funds. |
| | | | This is what is being sold all over the |
| It is shocking as to how many countries are | | | | internet as an offshore corporation |
| in such agreements. Even Panama is in such an | | | | misleading the people into thinking their |
| agreement but it is fairly limited in scope, | | | | privacy is being protected. Once again Panama |
| see below: | | | | passes the test. |
| | | | |
| Essentially Panama will cooperate in a | | | | Taxation Free The offshore jurisdiction must |
| multi-national case involving narcotics and | | | | be taxation free in that offshore derived |
| money laundering (these crimes need to be | | | | income is not taxed by the country where the |
| tied to narcotics). They also will get | | | | corporation is domiciled. Panama meets this |
| involved in cases concerning child | | | | test as does numerous other countries. Panama |
| pornography and real terrorism. If you are | | | | also has no capital gains tax for you stock |
| not a narcotics dealer and are not a money | | | | market investors and there is no inheritance |
| launderer (money launders are typically | | | | or probate tax. Panama passes this test. |
| dealing with many millions of dollars), not a | | | | |
| child pornographer, and not a terrorist you | | | | Weather Considerations Many of these |
| should not be concerned by this. The MLAT | | | | offshore jurisdictions are located on islands |
| requires that there first need to a criminal | | | | and are subject to power outages from |
| prosecution case on file in the criminal | | | | hurricanes. Also one must look for risk from |
| courts of the requesting government (which | | | | volcanoes, tsunamis and earthquakes. Just |
| means no fishing expeditions) then through | | | | what you don't need is a power outage from a |
| diplomatic channels involving the embassies, | | | | storm preventing you from getting your money |
| requests are made for information, then | | | | out when you need it. The reason the Panama |
| reviewed by Panama officials and a decision | | | | Canal was built where it is, is because there |
| on compliance is made or requests for more | | | | is no risk from hurricanes, tsunamis, |
| information are made so a determination can | | | | volcanoes and earthquakes. Panama passes the |
| be arrived at. These cases can take months | | | | test. |
| and even years for completion. At times the | | | | |
| country where the bank is located has been | | | | Infrastructure One must look at the power |
| known to once alerted to the problem, conduct | | | | generators, telephone system and internet |
| their own investigation first and this | | | | when evaluating an offshore jurisdiction. You |
| usually requires them to seize the relevant | | | | don't want to have to wait days or weeks to |
| records and documents which can stall the | | | | be able to use your online banking or to be |
| process for a long time even years since | | | | able to talk to your bank on the phone. |
| their justice systems typically moves quite | | | | Panama was basically built by the Americans |
| slow and statues of limitation can run out, | | | | who just left it in 2000. It has American |
| please don't construe this to mean Panama | | | | style phones, electricity, roads, etc. The |
| does this routinely it is just something that | | | | cells phones and internet in Panama are as |
| does occur from time to time around the | | | | good as Canada or USA. Panama passes the test |
| world. The MLAT has no application to civil | | | | again. |
| cases such as divorce, bankruptcy, civil | | | | |
| judgments, business litigation, any sort of | | | | Government Stability The last thing you need |
| civil litigation, civil tax matters etc. | | | | is to be banking in some tax haven offshore |
| Taxation matters of any sort are not covered | | | | jurisdiction and find out a revolution has |
| by this as far as Panama is concerned. Income | | | | taken place and you can kiss your money |
| tax evasion is a civil (non-criminal) offense | | | | goodbye. Another possibility is like what |
| in Panama. Switzerland cooperates on income | | | | happened in Grenada when there was rampant |
| tax cases if the return is filed falsely like | | | | bank fraud causing the closure and |
| all income was not declared, things were | | | | liquidation of the offshore banks with people |
| omitted or so the complaining government | | | | losing their savings. Panama is a stable |
| says. Panama has no extradition treaties. | | | | democracy. Panama is a UN neutral country so |
| Panama passes this test. | | | | a war is most unlikely. Panama is in a treaty |
| | | | with the USA concerning the Panama Canal |
| Tax Treaties Many so called Offshore | | | | which was given to them by the USA in 2000. |
| Jurisdictions are in Tax Treaties. For a list | | | | If the canal is threatened the USA has the |
| of countries with tax treaties with the USA | | | | right to step in to protect the Panama Canal. |
| click here. Panama has NO tax treaty with any | | | | This means that if there was a revolution |
| country. Even Switzerland and Belize are in | | | | (unlikely occurrence since Panama is a most |
| tax treaties as are most of the so called | | | | stable democracy) the USA would have fighter |
| offshore jurisdictions. Click here to see a | | | | jets there within an hour or two and by the |
| list of countries in tax treaties complete | | | | next day one could expect to see a navy |
| with links enabling you to read the actual | | | | aircraft carrier group in Panama Bay with an |
| treaties, a real eye opener click here: | | | | expeditionary force of marines. Next would be |
| | | | an airlift, paratroopers, helicopters, |
| Type of Bank License Many of these offshore | | | | nuclear submarines and you have the idea. |
| banks have offshore banking licenses versus | | | | Forget about an invasion, attack or |
| regular banking licenses. Let me explain. | | | | revolution in Panama, it passes the test. |
| These island jurisdictions usually have | | | | |
| different classes of bank licenses one class | | | | Currency Panama uses the US dollar as its |
| allows the bank to do business with only | | | | currency. The banks are on the US dollar and |
| residents of the country, the other class | | | | the ATM machines dispense US dollars, they |
| usually encountered is the offshore license | | | | even use US coins. This means a stable |
| that allows the bank to ONLY conduct business | | | | currency. I know some of you will say they |
| with non-residents of the country, and they | | | | like the Euro better fine but when I say |
| usually have a third class of license that | | | | stable compare it to the Bahamian Dollar or |
| allows the bank to do business with both | | | | Grand Cayman Dollar. No currency conversion |
| residents and non-residents. It is a natural | | | | costs in Panama if you use dollars. Panama |
| conclusion that a bank with an offshore only | | | | again passes the test. |
| license is a risky proposition at best since | | | | |
| the government won't let them do business | | | | EU Ties Panama has no ties that could erode |
| with the citizens of their country. The banks | | | | privacy again passing the test. No reportage |
| we use in Panama are open to the citizens of | | | | of income for EU residents or collecting of |
| Panama and are never offshore only banks. | | | | withholding taxes. Tax identity numbers from |
| Most of the bank accounts being offered by | | | | your home country are not required to open a |
| various web site businesses are with bank | | | | Panama bank account, own a corporation, buy |
| having only an offshore license. | | | | real estate etc. Panama again passes the |
| | | | test. |
| Corporation Privacy This is an important | | | | |