Why Panama?

Why Panama?
Selecting an offshore jurisdiction is an integral part of establishing an offshore structure or financial account. The jurisdiction that you choose should have at the very minimum, the following 10 characteristics:

1. A Full Fledged Tax Haven – Panama has no capital gains tax on offshore investments, no interest income tax on offshore bank account interest, no offshore income tax, no inheritance tax, etc.

2. Favorable Incorporation Laws - the corporate laws of the country should enable you to hold "Bearer Shares", have directors from any country, inexpensive, and be able to incorporate Private Interest Foundations like Panama does.

3. Stable Currency With No Currency Restriction Regulations - the currency of the country must be stable, and there should be no restrictions on the movement of funds in or out of the country, and your offshore bank should be able to hold your money in any major currency.

4. Strict Privacy Laws - there should be strict privacy laws that protect your banking information and corporate book information from anyone, including foreign governments.

5. Stable Government - the government of the country should be a stable democracy and should use the opposite legal system of your domestic country (if your country uses common law, you should seek a country that uses civil law). The country should also be safe to visit.

6. Stable Economy - the economy of the country should be stable, with consistent growth and low inflation.

7. Excellent Banking System - the banking system of the country should be advanced in areas of international banking regulations, infrastructure, government auditing, and technology.

8. Excellent Communications System & No Natural Disasters - the communications systems of the country should be technologically advanced in comparison with first world countries, and the country should be located in a region that is free of environmental / natural disasters (hurricanes, tornadoes, earthquakes, tidal waves, etc.), so communications are never severed or problematic.

9. Language Compatibility - the language of the country should be suitable for your understanding.

10. Time Zone Compatibility & Close Location - the time zone of the country should be such that you can contact your offshore provider or financial institution during your normal domestic business hours & fly to the country quickly (same day) if necessary to handle urgent business or financial needs.
After careful research, you will find Panama to be the ideal jurisdiction for your offshore needs, since Panama meets ALL of the above criteria! The Panama corporation law was promulgated over 70 years ago and has since been copied by many of the other tax haven nations. Panama is one of the most popular places in the world to incorporate, with currently over 500,000 registered entities. Panama also offers the Panama Private Interest Foundation, which is one of the most useful asset protection and estate planning vehicles available today.
Panama offers the following benefits and advantages:
1. Panama is a 100% Tax Haven: Non-resident Panamanian International Business Corporations (IBC's) and Private Interest Foundations do not pay tax on any of their income (as indicated below), nor do they have any reporting requirements to the Panamanian government.
· No income tax.
· No capital gains tax.
· No interest income tax.
· No sales tax.
· No tax on issuance of corporate shares.
· No tax to shareholders.
· No stock sale or transfer tax.
· No capital stock tax.
· No property tax.
· No estate tax.
· No gift tax.
· No stamp tax.
· No succession tax.
· No inventory tax.
2. Panama offers the most favorable and most flexible incorporation laws available in the world. Private Interest Foundations are also available, and are one of the most widely used estate planning structures in the world today.
· Panama is the registered domicile for over 500,000 corporations & foundations, making it the second most popular jurisdiction to incorporate in the world, next to Hong Kong.
· Panama does not impose any reporting requirements for non-resident Panamanian corporations.
· Panama does not allow "piercing the corporate veil".
· Panama corporations share certificates can be issued in Nominative or Bearer form (anonymous form of ownership), with or without par value.
· Panama corporations do not require Paid-In Capital, nor is there a time limit in which authorized capital must be fully paid.
· Panama corporations directors, officers and shareholders may be of any nationality and resident of any country.
· Neither the directors nor the officers of Panama corporations need to be shareholders.
· Meetings of directors, officers, and shareholders may be held in any country and accounting books may be kept in any country.
· It is not necessary for the interested parties to be present in Panama for the purpose of establishing a corporation.
· Corporations conducting business outside of Panama do not require a commercial license for offshore business activities.
3. Panama's circulating currency is the US Dollar, and Panama has no currency exchange controls or currency restrictions so funds can flow in and out of the country freely.
· Panama uses the U.S. dollar as its legal tender (currency), instilling tremendous fiscal and monetary discipline while keeping inflation very low - under two percent for the last 40 years.
· A dollar economy insulates Panama from global economic shocks. During the Asian monetary crisis of 1998, Panama became one of the healthiest economies in Latin America.
· No currency exchange controls. Panama has no restrictions on monetary remittances abroad, including dividends, interests, branch profits and royalties.
· No restrictions on funds flowing in or out of the country in any currency.
4. Panama continues to maintain what we consider to be the most solid banking and corporate book secrecy laws in the world, which are engraved in its' constitution. With Britain's proposed regulation for removal of bank and corporate book secrecy in the UK offshore territories, it is clear that Panama remains the most secure offshore financial center, where privacy and confidentiality is not only respected, but vigorously protected by constitutional law.
· Panama offers the best bank secrecy laws in the world.
· Panama offers the best corporate book secrecy laws in the world.
· There is no such thing as "piercing the corporate veil" in Panama.
· Revealing banking information to third parties is a crime, punishable by prison.
· Panama has no mutual legal assistance treaties (MLAT's) for sharing of banking information with any other nation. (Under the new internationally accepted anti-money laundering laws, they make exceptions in criminal cases of money laundering, drug related crimes, terrorism, etc.)
· Panama Corporations offer "Bearer Shares", allowing shareholders to maintain 100% anonymity and privacy.
· Panama Private Interest Foundations allow for Private Protectorate Documents and Private Letters of Wishes, enabling controllers (Protectors) and beneficiaries of Private Interest Foundations to remain 100% anonymous and private.
5. Panama has what is considered by government analysts to be the most stable government in all of Central or South America.
· Democratic government since 1990. The Government of Panama is headed by the executive branch, which is composed of a president and two vice presidents, democratically elected for a five-year term by direct vote.
· Mireya Moscoso, was the Panama's first female president and led the country at a moment of great historical importance as the Panama Canal began a new era under Panamanian administration. Our current president is Martin Torrijos, as of this writing (March 2009), whose term will end this year. Martin Torrijos has been very popular and approved the expansion of the Panama Canal.

· The Panamanian military was abolished by constitutional amendment in 1994, and the government still has a unique security arrangement with the U.S. due to the Neutrality Treaty of the Panama Canal. As a result, the risks of going back to the earlier military regime are virtually non-existent (Source: Euromoney Report/Lehman Brothers, Feb. 26, 1999).
· Stable government with excellent government infrastructure.
· Pro-business government attitude and policy.
· Civil law system.
· Moody's has issued Panama a sovereign debt ceiling of Ba1 and Standard & Poors as well as Fitch Ratings has assigned a default-risk rating of BB+/Stable/B as of March 2009. In September 2008, Moody's Assigned a Prospective (P) A2 Rating to the Senior Unsecured Debt Obligations of the Panama Canal Authority in Conjunction with the Expansion Project. The (P) A2 rating pierces the current Country Ceiling of A3 by one rating notch.
· Panama is a peaceful country with no military. Unlike many neighboring countries, personal security concerns are limited. Panama has the lowest crime rate in all of Central and South America.
6. Panama's economy is one of the most stable, prosperous, and most advanced in all of Central and South America.
· Panama is home to the second largest international distribution and trade center (free trade zone) in the world next to Hong Kong. Panama's Colon Free Zone has over 1500 international import/export businesses operating within it, receives more than 250,000 visitors yearly, and generates exports and re-exports valued at more than US$11 billion annually.
Why Panama - Colon Free Trade Zone, Panama
Most other tax haven nations such as Bahamas, St. Vincent, Cayman Islands, St. Kitts, Nevis, Vanuatu, Bermuda, Costa Rica, Belize, Isle of Man, etc. are simply tax havens that survive primarily on offshore banking and tourism.

Panama is a genuine international trade and banking center that is well known and respected throughout the world.
· The banking and commercial trade industry is alive in Panama with the US Dollar as its’ circulating currency. There are over 100 international banks in Panama.
· Low inflation - Panama's inflation rate has been less than 2% for the last 40 years, although it has been slightly higher this year (2008).
· Panama's GDP (2008) is over US$19 Billion. In recent years, the service sector has accounted for over 80% of the country's GNP. The Panama Canal is also a large contributor to Panama's overall economic success.
· Panama is at the top of the list of the world's freest economies, according to Canada's Fraser Institute (Economic Freedom of the World: 1998/9 Interim Report, Nov. 1998). Ranked eighth with Australia, Ireland, the Netherlands and Luxembourg, Panama represents an environment conducive for the creation of companies, jobs and prosperity.
· Panama is a member of the World Trade Organization (WTO) and is a beneficiary of the Caribbean Basin Initiative (CBI). Panama has initiated formal negotiations pertaining to free trade agreements with numerous countries and regional groups.
· Panama has been ranked first in Central/South America for low cost of living, operational cost and index of labor by the Tripartite Committee, which consists of the Economic Commission for Latin America and the Caribbean (ECLAC), the Organization of American States (OAS) and the Inter-American Development Bank (IDB).
· Political Risk Services (PRS) placed Panama in the top three countries of the hemisphere with the best risk-investment qualifications.
· The Wall Street Journal/Heritage Foundation's annual Index of Economic Freedom found Panama second in the region.
· Panama's open economy offers the lowest tariffs in the region, which has helped increase foreign investment in both the public and private sectors. There are more than 40 laws and decrees that offer investors special import, tax, and operational incentives. Sectors enjoying these incentives include tourism, export processing zones, mining, reforestation, insurance and re-insurance, agro-industry, petroleum free zones, infrastructure and construction.
· The Investments Stability Law (Law No. 54 of July 22, 1998) guarantees all foreign and national investors equal rights, continuing Panama's long-standing policy of providing a foreign-investment environment that requires no special authorizations, permits or prior registration.
· Major companies in Panama include international names such as Federal Express, DHL, UPS, Price-Mart, Movistar, Kansas City Southern Railways, Continental Airlines, Copa Airlines, American Airlines, ICA (construction), Cable & Wireless, Digicel, Claro Communications, Evergreen, Hutchinson Whampoa, and many others.
7. Panama City is home to the second largest international banking center in the world next to Switzerland. Panama has the most modern and successful international banking center in Latin America, with more than 100 banks from 35 different countries.
Why Panama - Panama City
Panama is the largest international banking center in the world next to Switzerland.
Approximately 100 international banks are located in Panama.

· Panama offers a modern and technologically advanced banking system.
· Panama is one of the most stable banking jurisdictions in the world.
· Thanks to an excellent, diversified economy, and very strict banking regulations, very few banks have failed in Panamanian banking history. The USA, UK, and even Switzerland have had several bank failures within the last 10 years, not to mention many other tax haven's bank failure rates. Even during the recent (2008 - 2009) global banking crisis, not one Panamanian bank has been reported to have any liquidity problems.
· The Panamanian government has enacted strict bank auditing guidelines, to monitor banking practices, credit guidelines, and overall bank administration. Each bank must submit monthly auditing reports to Panama's Banking Superintendence and National Banking Commission, together with the government owned Banco Nacional de Panama (National Bank of Panama).
· The Panamanian banking system is set up to ensure depositors the security of their deposits. The National Banking Commission (NBC) and the Banco Nacional de Panama (BNP) execute the functions of a central clearing bank. The NBC oversees the banking system, sets the reserve requirements and regulates interest rates. The BNP functions as the Panamanian governments principal depository, manages the country's international reserves and is the clearing-house for the banking system.
· Panama's new comprehensive banking law (Decree No. 9) meets the standards of leading financial centers around the world for transparency and regulation, and conforms to the statutes of the Basle Commission.
· Some of the banks present in Panama's banking center are: Citibank, HSBC / Banistmo, Bank of Tokyo, Bank of Boston, Banco Nacional de Paris, International Commercial Bank of China, Banco du Brasil, Societe Generale, Banque Sudameris, BBVA, Metrobank, Banco General, Global Bank, Multi Bank, Banco Aliado, BancoLat, BIPAN, Bank of Nova Scotia, Banvivienda, Credicorp Bank, and much more.
· The Panama Stock Exchange is the fastest growing in the region with an average total trading volume of US$900 million.
· Some of the brokerage firms present in Panama are (some through affiliates): Merrill Lynch, Pershing / DLJ, Paine Webber, Solomon Smith Barney, Credit Suise, EFG Securities, Thales Securities, PanAmerica Capital Group, Financial Pacific, and several others.
8. Panama's communications systems and infrastructure are the equivalent of any first world country such as the USA, Canada, or the United Kingdom. Telephone, fax, internet, and cellular communications are all offered in Panama by the worlds’ largest communications companies.
· Panama has the highest level of communications infrastructure for telephone, fax, internet, and cellular communications in all of Central & South America, including the Caribbean.
· Panama's privatization efforts in the telecommunications sector were initiated in 1995, with the restructuring of the state-owned monopoly operator, INTEL, the subsequent concession to Bell South in 1995 to operate one of the two (2) cellular mobile telephone licenses and the sale of 49% of the shares of INTEL to Cable & Wireless (a UK company) in 1997.
· Cable & Wireless enjoyed complete management responsibility, exclusivity in certain telephone services (including international long distance services) for a period of five years (which expired in 2003) and has a license to operate in the mobile cellular communications sector. Movistar has the second largest share in the mobile cellular communications sector. Digicel and several other companies also operate in the cellular communications sector in Panama.
· Panama has the best access to multiple high-bandwidth continental fiber optic networks in telecommunications infrastructure. The extremely low risk of natural disasters (hurricanes etc.), gives the Panama telecom sector security and reliability of service as well as a competitive advantage over other offshore jurisdictions.
· Panama is extremely easy to access from almost anywhere. Due to its central location in the middle of the Americas, Panamas’ COPA Airlines (partly owned by Continental Airlines) has converted Panama into a major hub for international travelers. Panamas’ proximity to large cities with direct flights from North America, Central America, South America and Europe makes it relatively cost effective to bring in specialist know-how for installation and maintenance. Direct flights are available to Panama from most major cities around the globe.
· Panama's long history as an international banking and services jurisdiction, has resulted in the availability of technical know-how in internet technology and information technology as well as sufficient human resources to install and maintain e commerce operations. The MAYA-1 and ARCOS-1 ring systems link the continental Americas and the Caribbean Basin, which was completed in December of 2000.
· All the preceding advantages, incentives and infrastructure place Panama as an ideal location for: Internet Service Providers, E-Commerce Providers, Applications Outsourcing ASP, Broadband Content Providers, New Media Content Providers, and Exchange Traffic.
9. Panama's official language is Spanish, however, English is the second most widely spoken language. 8 out of 10 Panamanians living within the banking sector of Panama City are bi-lingual in English and Spanish.
· English is a widely spoken language in Panama.
· 9 out of 10 educated Panamanians have traveled to the USA.
· Panama has a very high literacy rate in comparison with other Central and South American countries.
10. The Republic of Panama is located at the narrowest point of the Central American Isthmus, which connects the continents of North and South America. It is just 2.5 hours by air from Miami, FL, USA and located in the same time zone as the U.S. East Coast (five hours behind Greenwich Mean Time).
· Panama is located between Costa Rica & Colombia.
· Panama is on Eastern Standard Time (same as New York, USA).
· Panama is just 2.5 hours away by air from Miami, Florida, USA.
Panama is the ideal jurisdiction for international investors and businessmen to operate their offshore corporations, banking, investing, finances, and all other areas of international trade!
Take the next step to financial freedom, and incorporate in Panama Today!
Offshore Pro Group