Foundation

I. Highlights

A Private Foundation is a unique form of legal entity, which acts like a Trust and operates like a company. Following are some of the advantages of Private Foundations:
A Foundation is a sui generis body corporate, in existence only in Liechtenstein, Panama and Austria, only Liechtenstein and Panama are "offshore jurisdictions".
Beneficiaries are not of public record. No requirement to file annual returns or financial statements; full exemption from taxation on any business activity; simple ongoing administration.
A Foundation may transact business in whatever currencies it chooses; its founders, members of the foundation council and protectors may be of any nationality and may be residents of any country; the accounting books of the Private Foundation may be kept in any jurisdiction.
In no case may its assets be used to satisfy the founder's or the beneficiaries’ obligations.

II. Requirements

A Private Foundation is a legal entity established through a private or public instrument, by either one or more private person(s) or corporate entity (ies) (called the Founder(s)) and the allocation or endowment of funds or assets by the Founder is essential to its creation. The Foundation becomes a corporate body (juridical person) by registering a Foundation Charter at the Public Registry, which contains:
Its name, which must include the word "Foundation" (in any language)
Its domicile
The initial capital/estate (expressed in any currency) which can not be less than the equivalent of US$10,000.00
The name(s) and address(es) of the Member(s) of the Foundation Council which administers the estate (they can be individuals or corporate entity(ies))
The name and domicile of the Foundation's Resident Agent
The objectives and goals of the Foundation (these must be possible, reasonable, moral, and legal)
The manner in which the Beneficiaries (which may include the Founder), are selected
Reservation of the right to modify the Foundation Charter
The duration of the Foundation
The use to be made of the Foundation's assets and the manner in which its estate is to be liquidated in the event of dissolution.

III. Foundation Council

Members of the Foundation Council may be natural or juridical persons of any nationality.
The Foundation Council has the following obligations and duties:
To manage the assets of the Foundation in accordance with the Foundation Charter or its regulations.
To carry out those acts, contracts or business as may be expedient or necessary to fulfil the purpose of the foundation and to include in such contracts, agreements and other instruments or obligations, such clauses and conditions as are necessary and expedient, being consistent with the foundation's purposes and not contrary to law, morality, good manners or public order.
To inform the beneficiaries of the foundation about its economic situation as provided by the Foundation Charter or its regulations.
To hand over to the beneficiaries of the foundation the assets or resources settled in their favour in the Foundation Charter or its regulations.
To carry out those acts or contracts which the foundation, according to the Private Foundations Law and other applicable legal or regulatory provisions, may be permitted to carry out.

IV. Beneficiaries

Optional Foundation Regulations (which are not registered at the Public Registry) can also be prepared, and this document could contain details regarding the Foundation Council's attributes, frequency of statements, causes for removal of the Foundation Council, and the manner of distribution of the Beneficiaries' interests. It is not required to appoint beneficiaries in the Foundation Charter.

V. Obligations

As established in the Private Foundations Law, the foundation's assets shall constitute a separate estate from those of the founder's personal assets for all legal purposes. Therefore, same may not be seized, attached, or be the object of any action or preventive measures, save for obligations incurred or damages caused upon fulfillment of the foundation's aims or objectives or due to the legitimate rights of the foundation's beneficiaries. In no case shall they be used to satisfy the founder's or the beneficiaries' obligations. The founder's creditors shall have the right to object to the contribution or transfer of assets of a foundation where same constitutes a fraudulent act against creditors, but the rights and actions of such creditors shall prescribe in three (3) years as from the date of the contribution or transfer of assets to the foundation.