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What is the difference between a Corporation, Foundation or Trust? |
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For banking purposes, there is very little difference. All organizations include what is required to open a banking or brokerage account. Generally, the corporations are used for business profit purposes, such as security trading, banking, international commerce, real estate property, etc. Most of our clients establish a corporation. Foundations are more commonly used for non-profit activities such as charities, give or receive donations, grants, etc., but also they may be used for “holding” purposes, as to keep the property of corporations or any other type of goods. Most of our clients use the foundations for confidentiality purposes to keep the ownership of their corporations and asset protection. Trusts are generally used as “holding” of a corporation property or to keep assets as real estate. Very few clients establish a Trust due to the extensive regulations regarding offshore Trust that exist in many countries where they live (USA, Canada, United Kingdom, Australia, New Zealand, etc.). As a result of the drop in popularity of offshore Trusts, we have abstained from selling or recommending these for the moment. However, these are general guidelines of the main functions of each type of entity and they not necessarily need to be followed, since in Panama there is no authority that strictly enforces the use of each entity.
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